ASSESSMENT OF SERVICE QUALITY FROM CUSTOMER PERSPECTIVE: THE CASE OF COMMERCIAL BANK OF ETHIOPIA (CBE)

Abstract

Objective of this study is to analyze the customer evaluation of banking service quality provided by commercial bank of Ethiopia. This research is a descriptive research aimed at assessing and describing customers’ expectation and perception of service quality in the banking service of main branch of commercial bank of Ethiopia using SERVEQUAL, and subsequently identifying the gap of service quality dimensions. The target population of the study is customers of commercial bank at the main branch. In all 100 customers of the bank were selected as the sample size of the study. The expectations and perceptions of the respondent were evaluated under the five dimensions of SERVQUAL model of tangibility, reliability, responsiveness, assurance and empathy. The overall analysis for the five dimensions indicates that the customers’ perceptions fall short of their expectations. It was found that background characteristics such as age, income level, occupation and qualification of customers of the bank have significant influence on customers’ expectation and perception of banking service quality. It is recommended that greater emphasis should be placed on responsiveness and followed by reliability since it was found to be a higher service quality gap among the five dimensions. Generally the conclusion is the overall SERVQUAL score is the result of average perception score minus the average expectation score derived from the SERVQUAL instruments. When we take a closer look at the individual items, it is found that the individual statements under each dimension have a negative service quality gap implying that the overall expectation of service quality of the bank falls short of expectations. Policy makers of Commercial Bank of Ethiopia should factor in customers’ background characteristics when formulating policies on improving service quality.