Determinates Of Bank Selection In Ethiopian Banking Sector: Evidence From Customers In Addis Ababa

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Addis Ababa University


In today’s business environment, especially in the banking industry there is strong competition and dynamics of markets. Due to this complexity, commercial banks need to identify the criteria on which customers determine their bank selection decision. Therefore the objective of this study is to investigates the determinants of bank selection in Addis Ababa, Ethiopia, and how customers rank the factors based on their importance level to patronize banks and banking service. In the meanwhile, this study also provides results of whether the variables such as Service Quality, Convenience/Security, Technology, Marketing & Promotion, Bank Image, Financial benefits, Bank's Reputation and Proximity have significant effect on bank selection decision. Both qualitative and quantitative data analysis techniques, using responses given by 358 bank customers in Addis Ababa city from different occupation, age and income group is employed in the analysis. Two stages stratified sampling method was used and data analysis was conducted by using descriptive and inferential statistical tools with the help SPSS version 22 for windows. Finding this study showed that Convenience/Security, Technology, Marketing & Promotion, Bank’s Image and Proximity have significant positive relationship with bank selection decision while Service quality, Financial benefits and Bank’s reputation have significant negative relationship with bank selection and 86.6% of bank selection decision explained by independent variables.



Bank selection criteria, Customers