The Effect Of Customer Service Quality On Customer Satisfaction In Banking Industry: The Case Of Commercial Bank Of Ethiopia

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Addis Ababa University


The quality of service provided to customers’ plays a vital role in any service related economic sector including the banking industry. In service providing companies, improving service quality is now regarded as the most significant act in attaining a competitive edge in the market. The general objective of this study was to assess the impact of customer service quality on customers’ satisfaction in the case of Commercial Bank of Ethiopia (CBE). The study was set out as an explanatory research involving some branches of commercial bank of Ethiopia found in Addis Ababa which are selected based on convenience sampling. Structured questionnaires were administered to 350 sampled respondents, and 342 participants properly responded to question items which constitutes 97.7% response rate. Data analysis was performed through Statistical Package for Social Scientist (SPSS) version 22.00. The perceptions of customers of commercial bank of Ethiopia were assessed through the five dimensions of service quality. Both descriptive and inferential outputs were generated. Cronbach’s alpha, factor analysis Spear’s man correlations, and multiple regressions were computed. The results of this study indicate that, all the five service quality dimensions (tangibility, reliability, responsiveness, assurance and empathy) have positive and significant relationship with customers’ satisfaction. All the five service quality dimensions (tangibility, reliability, assurance, responsiveness and empathy) significantly explain 30.5 % of the variations in the satisfaction of customers. From qualitative findings of the study, the factors most affecting customer satisfaction were sluggish network system, poorly performing ATM machines, long waiting time, not assigning enough number of customer service representatives, low problem solving ability. Therefore, the bank should try to improve its services by solving its connectivity problem, giving customer oriented training to its employees, educating its customers, developing new products, assigning enough number of customer service representatives, implementation of advanced technologies, customizing its service, giving fast response to customers problem



Customer Service quality, Customers’ Satisfaction, Tangibility