Customer Service Quality and Customer Service Expectations in Banking Sector

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Customer service quality and customer service expectations in banking sector.

Abstract

This research explores the relationships between service quality, customer involvement and customer satisfaction in the highly competitive banking sector. The study sought to identify the most important attributes in bank settings, which may be used to review characteristics of the banks as experienced by customers. The main aim is to find out customer service quality performed by banks at present and expectations of customers from the banking service. From past studies on this subject it is clear that there is some service quality gap that should be minimized. Banking organizations as well as other authorities interested about the subject can use the article.

Introduction:

Intangible products such as accounting, banking, cleaning, consultancy, education, insurance, expertise, medical treatment, or transportation are part of service. Sometimes services are difficult to identify because they are closely associated with a good; such as the combination of a diagnosis with the administration of a medicine. No transfer of possession or ownership takes place when services are sold, and they (1) cannot be stored or transported, (2) are instantly perishable, and (3) come into existence at the time they are bought and consumed.

In 1988, Parasuraman et al arranged a quantitative Research. They revealed an instrument for measuring consumers’ perception of Service Quality, after that it became known as SERVQUAL. They collapsed their dimensions from ten to five. The dimensions were:

Tangibles – physical facilities, appearance of personnel and equipment

Reliability – ability to perform the promised service dependably and accurately

Responsiveness – willingness to help customers and provide prompt service

Assurance - Assurance (combination of items designed originally to assess Competence, Courtesy, Credibility, and Security) – ability of the organization’s employees to inspire trust and confidence in the organization through their knowledge and courtesy.

Empathy - Empathy (combination of items designed originally to assess Access, Communication.

Organizations can use SERVQUAL in various ways. Parasuraman et al (1988) mentioned that SERVQUAL can help the Service and Retailing Organizations in assessing the expectations of customers and Service Quality perceptions. It can focus on the core areas where managers need to take attention and action to improve Service Quality.

Literature review

An extensive effort has been made to explore banking services in different developed country contexts. The review of relevant literature reveals that very limited effort has been made in terms of correlating service quality, satisfaction and loyalty in the banking sector. This study integrates a broad review of relevant literature, which helps to synthesize the variables and research contexts regarding service outcome of both public and private bank. Service quality is one of the important determinants for the success of a bank. It is difficult to measure quality of service due to its distinct characters. In comparison, goods have tangible characteristics and thus can be readily measured by objective indicators such as performance, physical attributes and durability (Hoffman & Bateson, 2002). In fact, service quality is measured by intangible and subjective elements such as attitudes, perceptions and feelings of customers. Increasingly service quality dimension is becoming ever more important both for researchers and service providers.A conceptual model concerning perceived service quality was first developed by Parasuraman et al. (1985). They identify ten dimensions (tangible, reliability, responsiveness, competence, courtesy, credibility, security, access, communication, and understanding the customer) of measuring service quality. The study found that the differences between perceived performance and expected...
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