Effect of Service Quality on Customer Satisfaction in Commercial Bank of Ethiopia, Branches in Wolaita Sodo

Abstract

There is increased demand for higher quality services as consumers all over the world in all sectors become more quality conscious. The objective of this study was to assess the effect of service quality on customer satisfaction in the Commercial Bank of Ethiopia branches in Wolaita Sodo town. For this purpose, 383 respondents were selected from target population and 22 item likert scaled SERVPERF instrument questionnaires were distributed and 344 valid responses were analyzed. The correlation analysis indicated that there were positive and significant relationship between all service quality dimensions and customer satisfaction. Regression analysis which was performed to study the effect of service quality on customer satisfaction found that four service quality dimensions: namely, empathy, responsiveness, reliability, and assurance were positively and significantly affect customer satisfaction and the tangibles dimension was insignificant for analyses. Compared with other quality dimensions in SERVPERF instrument, empathy has high effect on customer satisfaction. The bank is recommended to work hard in all quality aspects and give more personal attention to customers, understand the interest of customers, care for their customers, and give prompt service.