Service Quality and Customer Retention a Case Study Dfcu Bank Freedom City Branch

Abstract

The purpose of the study was to asses Service quality and Customer Retention Uganda, using DFCU Bank as a case study. The objectives of the study were to examine how reliability affects customer retention in DFCU Bank .To investigate the effect empathy has on customer retention and to assess how assurance of services in DFCU Bank influences customer retention.

The study was a cross sectional survey where both qualitative and quantitative data were gathered in order to establish the relationship between the variables under study. Data was collected from Customers of DFCU Bank, their sample size comprised 55 respondents who were purposively selected and simple random sampling was jointly used to minimize biased results. Self-administered questionnaires were the main instrument of the study and data was analyzed using frequencies, percentages, mean, standard deviation and SPSS was used to establish findings about Service Quality and Customer Retention. The results of this study indicated that DFCU Bank provides quality services which express empathy to customers through customer care and give assurance services to its customers.

The study revealed services are perceived to be of quality by majority of the customers of DFCU Bank although a few disagree claiming to have challenges with the Services offered, where the customer deflection rate was steadily increasing. It is therefore this steady rise that necessitates the investigation of its problem cause.

Despite of this, there exists a strong positive relationship and bond between Service quality and Customer Retention that’s to say a correlation of 0.028 between Reliability and Customer Retention , correlation of 0.199 between Empathy and Customer retention and a correlation of 0.105 between collection Assurance and Customer Retention (using correlation SPSS).This implies that the effectiveness of Service quality leads to higher Retention levels of the bank's customers.

The researcher recommends that DFCU Bank educates its Customers on how to use its Services for more flexible banking services for those experiencing difficulty, Make an effort to receive feedback from customers about their service experiences in DFCU Bank and lastly build more loyalty programs in order to build stronger relationships with its Customers.

Login to download()