THE IMPACT OF SERVICE QUALITY ON CUSTOMER LOYALTY: THE CASE OF WEGAGEN BANK SHARE COMPANY

Abstract

The main goal of this study is appraising the service quality level of Wegagen Bank Share Company’s and investigating its impact on customer loyalty. To this end, these customers’ level of loyalty and their perception of the quality of service being provided by this bank were investigated. To accomplish this, Descriptive research design employed Self-administered questionnaire with 22 items SERVPERF scale, on a five-point Likert-type was used by this research to evaluate the impact of service quality on customer loyalty to 301 customers of Wegagen Bank using convenience sampling technique. Data from the questionnaires were analyzed through descriptive statistics and chi square test. Binary logistics regression analysis was also used with the help of SPSS version 25 statistical software program. According to the findings, customers are not much complaining physical design and appearance of the bank. However, of these dimensions, responsiveness and reliability were found to be low to customers. The impact of service quality on loyalty is observed with reliability and tangibility dimension of SERVPERF model according to Binary Logistics Regression result. The findings demonstrated that improvement in service quality can enhance customer loyalty. It is recommended that improving the reliability, looks of employees and physical facilities will enhance the loyalty of customer to the Bank.