ASSESSMENT OF THE SERVICE QUALITY OF UNITED BANK S.C. AND ITS IMPACT ON CUSTOMER SATISFACTION

Abstract

Commercial Banks in Ethiopia to increase their market share are in high competition, to provide a high quality of service to their customers. This paper tries to access the service quality of United Bank S.C. and its impact on customer satisfaction. It is mixed type of research a descriptive & causal type of study that collects quantitative data on customer satisfaction-dependent variable and the service quality measurement dimensions; independent variables. The independent variables are tangibles, reliability, responsiveness, assurance and empathy. The instrument measured service performance by using twenty two indicators that belong to the five dimensions of SERVPERF. The instrument was tested for reliability and validity. Self administered questionnaire was distributed to 385 customers of United Bank S.C., in 21 selected branches of Addis Ababa. The response rate was 89%. Descriptive and inferential statistics was used for data analysis. Descriptive statistics like proportion (Percentage), frequency, median, and mode was used to interpret demographic variables of the respondents and to find the mean sores of service quality dimensions whereas inferential statistics used to see the relationship among independent and dependent variables. Correlation between variables was made and results were all positive with significant effect. Hypothesis was tested to find out whether service quality dimensions had a positive relationship with customer satisfaction. The results indicated that the three dimensions responsiveness, assurance and empathy had a positive correlation with service quality except tangibility & reliability, and 93% of the customers were satisfied with the service rendered by UB. And also the regression analysis indicated the two most dominant service quality dimensions from the five dimensions; empathy followed by assurance The finding of this study is important to help managers focus their attention on the service quality dimension that matters most to customers.