Global Journal of Management and Business Research, E: Marketing, Volume 23 Issue 2

Influence of Service Quality Dimensions in Commercial Banks of Bangladesh: Existing vs Expected Md. Asfaqur Rahman α & Ela Saha σ Abstract- The economy of a country is largely dependent on banking sector. In this case, Bangladesh is not exceptional. Commercial banks of Bangladesh play a vital role in the economy, making up one of the biggest providers of services in the economy. In the current banking environment, service quality is one of the main weapons, which enables the banks to differentiate from each other. Hence, providing a better service quality is vital, as banks have to compete for customers. The primary focus of the study is to identify the gap between existing and expected service quality in terms of basic services, advanced services, cost and prestige, customer satisfaction and customer loyalty issues. Upon carrying out the study, a total of 120 (200 successful surveys) samples were surveyed in different commercial banks of Bangladesh. A questionnaire for such purpose was designed and different statistical methods were applied to analyse the collected data. From the study of descriptive statistics it is found that the overall service quality in commercial banks in Bangladesh is moderate. Whereas the sample t-statistics of the study shows that there is no significance difference between the existing and expected services of commercial banks of Bangladesh because the customer’s demographic characteristics. The research findings also suggest that there is a strong influence of service quality dimensions on customer satisfaction and customer loyalty. Hence, the recommend- dations would open up a new method of designing banking service in developing country like Bangladesh. Keywords: bank, customer, existing and expected, loyalty, quality, satisfaction, serive. I. I ntroduction anking is one of the most sensitive businesses all over the world. A bank is a financial intermediary that accepts deposits and channels those deposits into lending activities, either directly or through capital markets. According to Islam & Ahmed (2005) bank is a service selling institution, plays a significant role in a contemporary world of money and economy. It influences and facilitates many different but integrated economic activities such as resource mobilization, poverty elimination, production, and distribution of public finance (Chowdhury & Ahmed, 2009). Bangladesh has a well-developed banking system, which consists of a wide variety of institutions ranging from a central bank to commercial banks and to specialized agencies to cater special requirements of specific sectors. After deregulation and privatization policy was implemented by the government, private banks have got enormous benefits to set up facilities. As a result, numbers of private commercial and investment banks have been established. This results significant develop- ment of banking industry in Bangladesh during recent past years. The banking system of Bangladesh is dominated by the 4 Nationalized Commercial Banks in which 3 are totally controlled by government and 1 (Rupali Bank) bank is controlled by both government and private sector. Private banks are the highest growth sector due to the dismal performances of government banks. They tend to offer better service and products. Now 36 private commercial banks are operating in Bangladesh. There are also 10 specialized development banks and 10 Foreign commercial banks are operating in Bangladesh (Bangladesh Bank, 2017). Banks nowadays have to be of world-class standard, committed to excellence in customer’s satisfaction and to play a major role in the growing and diversifying financial sector. Banks have recognized the need to meet customer’s aspirations. The customer is the focus and customer service is the differentiating factors (Ahmed & Khondoker, 2003). A bank can differentiate itself from competitors by providing high quality customer services. Organizations operating in service industries should consider service quality a key strategic issue for the business success. Service quality issue is equally important for commercial banks. The problem with service failure is that it may lead to a destroyed relationship between the customer and the organization. The importance of customer satisfaction in today’s dynamic corporate environment is obvious as it greatly influences customer’s repurchase intensions whereas dissatisfaction has been seen as a primary reason for customer’s intentions to switch. Satisfied customers are most likely to share their experiences with other five or six people around them (Jahiruddin & Haque, 2009). Equally, dissatisfied customers are more likely to tell another ten people about their unfortunate experiences with a particular organization. In order to achieve customer satisfaction, organizations must be B 21 Global Journal of Management and Business Research Volume XXIII Issue II Version I Year 2023 ( )E © 2023 Global Journals Corresponding Author α : Associate Professor Department of Business Administration Pabna University of Science and Technology Pabna- 6600, Bangladesh. e-mail: asfaq@pust.ac.bd Author σ: Lecturer Department of Business Administration Premier University Chattogram 4203. e-mail: sahaeladu84@gmail.com