International Journal of Bank Marketing

Service quality and customer satisfaction in Ghanaian retail banks: the moderating role of price
Bedman Narteh,
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Bedman Narteh, "Service quality and customer satisfaction in Ghanaian retail banks: the moderating role of price",
International Journal of Bank Marketing, https://doi.org/10.1108/IJBM-08-2016-0118
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 Service quality and customer satisfaction in Ghanaian retail banks: the moderating role of
price

Abstract
Purpose: Various models and scales exist in the literature to measure retail bank service quality
without any attempt at integrating them and the moderators have often been under explored. This
paper integrated the SERVQUAL and BSQ models and moderated the resulting scale with price
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in order to examine service quality and customer satisfaction with retail bank services in Ghana.

Design/Methodology/Approach: The study is quantitative and the survey methodology was

used to collect data from 560 retail bank customers. The result was analysed through Structural
Equation Modelling.

Findings: The study provides an expanded model for measuring retail bank service quality as
seven of the eight latent constructs emerged as service quality dimensions when moderated with
price. It is significant to also note that five of the constructs -- Tangibles, Reliability, Assurance,
Empathy and Price -- from the direct relationship emerged as the dimensions of retail bank
service quality that positively and significantly predicted customer satisfaction.

Practical implications: The study provides insight into customer behaviour with the quality of
retail bank services in Ghana. The resulting broader dimensions provide an integrated and
expanded model as well as pointers to bank managers on service quality and customer
satisfaction cues to enable them attract, serve and retain customers.

Originality/Value: The study is the first of its kind to integrate two of the popular models to
measure retail bank service quality and to use price as a moderator of this relationship. The
resulting scale, which comprised of variables from the two models, provides support for the
approach used in the current study.

Key Words: Service quality, Customer Satisfaction, Retail Banks, SERVQUAL, BSQ, Ghana
Paper type: Research

1
 Introduction
The quest for service quality has been an essential strategic consideration for banks attempting
to survive and prosper in today’s hyper competitive environment. Research has demonstrated
that service quality is positively related to customer satisfaction (Gera, 2011), customer loyalty
(Siddiqi, 2011), financial performance (Agathee, 2010; Jain and Gupta, 2004) and competitive
advantage (Wang et al., 2003; Kelley et al., 2002). This makes the subject of service quality an
important area of business research (Mersha et al., 2012; Kumar et al., 2009), and prompted
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Sangeetha and Mahalingam (2011) to conclude that service quality has been at the fore front of
academic and practitioner research in services marketing.

Service quality in retail banking has been well researched and an over flogged research area
(Mersha et al., 2012; Abdullah et al, 2011; Aldlaigan and Buttle, 2002). A search through the
literature reveals that various models and scales have emerged in the literature on the subject.
These include the well- known SERVQUAL model (Parasuraman et al., 1988; Mersha et al.,
2012; Kumar et al., 2009), the BSQ model (Bahia and Nantel, 2000; Abdullah et al., 2011) and
the SYSTRAC-SQ model (Aldilaigan and Buttle, 2002). Recently, this stream of research has
even been extended to include retail bank hybrid services (Ganguli and Roy, 2010) and
electronic platforms (Narteh, 2013a; Katono, 2011). A comprehensive review by Sangeetha and
Mahalingam, (2011) has shown that as at 2006, as many as 14 models have been used to measure
retail bank services quality. Choudhury, (2013) after an extensive study of retail bank service
quality and purchase intentions, recommended the need to modify existing scales in order to
provide a better measure of bank service quality. A review of the extant literature revealed that
researchers have adopted or adapted the existing models without any attempt at integrating them
in order to measure retail bank service quality.

Moreover, Brick et al., (2010) after studying retail bank service quality in 10 African countries
concluded that service quality perceptions vary among countries in Africa and called for specific
country studies to provide further insight into customer perceptions of service quality. A review
of the literature indicates that apart from the works of (Hinson et al., 2006; Okoe et al., 2013),
not much has been done in the subject area. To cap it all, Sangeetha and Mahalingam (2011)
2
 concluded from their reviews that the relative importance of the service quality dimensions
varied across cultural contexts and called for country-specific studies that could address the issue
of service quality dimensions in retail banks. Moreover, prior studies have often assumed a direct
relationship between service quality dimensions and customer satisfaction (Landhari et al., 2011;
Priluck and Lala, 2009). The moderators of this relationship have often been ignored even
though literature argues that price expectations for instance, influence service quality perceptions
of customers (Toncar et al., 2010; Kim et al., 2006). This means that actual price paid for
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services by customers could impact on their service quality perceptions but this price-quality
relationship has often been under studied (Kim et al., 2006). The current study proposes to
address these research gaps. First, we integrate the SERVQUAL model (Parasuraman et al.,
1988) and the BSQ model (Bahia and Nantel, 2000), two of the dominant models to measure
retail bank service quality and customer satisfaction. Secondly, we moderated the relationship
with price in order to help rekindle the old argument of price-quality expectation among
customers. Such a study will provide bank managers with further and deeper insight into service
quality, price expectations and customer satisfaction with retail bank services.

The study is expected to make two major contributions to the literature on retail bank marketing.
Firstly, it provides an integrated model for investigating perceived service quality and customer
satisfaction in retail banks. Secondly, the moderating role of price is introduced to help
understand the influence of price on the relationship between service quality dimensions and
customer satisfaction. Moreover, the study will also contribute to the stream of ongoing research
(Narteh and Kuada, 2014; Hinson et al., 2011, Katono, 2011) on service quality and customer
satisfaction with retail bank services and respond to the call by Bricks et al., (2010) for country
specific studies on retail bank service quality in Sub-Saharan Africa.

The paper after the background discussions continues with the literature review on service
quality, bank service quality and customer satisfaction in retail banks. This is followed by the
conceptual framework and hypothesis development for the study. The next section is used to
discuss the methodology guiding the empirical investigation. This is followed by the data

3
 analysis, results and discussions. The last section discusses the implication of the findings and
the paper ends with possible limitations and directions for future studies.

Literature Review
Service quality
One attribute that has gained the attention of researchers in services marketing is service quality
(Parasuraman et al., 1988; Day, 1969; Wong and Zhou, 2006; Olorunniwo et al., 2006; Petridou
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et al., 2007). The extant literature suggests that service quality is determined by the difference
between customer expectations of service provider’s performance and the evaluation of the
actual service received (Parasuraman et al., 1988). Service quality has also been conceptualised
as a focused evaluation that reflects the customer’s perception of specific dimensions of service
(Hinson et al., 2006). In addition, Parasuraman, et al., (1985) defined service quality as the
degree and direction of discrepancy between consumer’s perception and expectations in terms of
different but relatively important dimensions of service. Service quality in the banking industry
has been measured with different dimensions resulting in different scales. These are discussed
below.

Bank service quality models

Service quality in retail banks has attracted wide researchers and practitioners attention (Lee,
Chen and Lai, 2011; Korda and Snoj, 2010). A detailed review of the literature indicates that
various models and scales have been used to study service quality in retail banks. The field could
be divided into three fold: SERVQUAL advocates, modified SERVQUAL advocates and new
model advocates. The review below sheds light on some of the major studies in these fields.

SERVQUAL model
The SERVQUAL model, postulated by Parasuraman et al., (1988), has received wide research
attention and application in the retail bank service quality literature. The model is anchored on
the position that service quality is measured using five major factors of reliability, tangibles,
empathy, assurance and responsiveness (Parasuraman et al., 1988). Using the model to study
retail bank service quality, the authors found reliability as the most significant dimension of
4
 service quality that predicted customer satisfaction. Studies by Asubonteng, et al., (1996)
confirmed the reliability and validity of the SERVQUAL model.

Using the SERVQUAL scale, Ravichandran et al., (2010) in India measured service quality and
customer satisfaction and found that only responsiveness was significant in predicting customer
satisfaction. Ladhari et al., (2011) discovered that empathy and reliability dimensions of service
quality have strong influence on repurchase intentions, satisfaction and loyalty in Canada while,
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reliability and responsiveness were the highest in determining customer satisfaction and loyalty
in Tunisia. Arasli et al., (2005) in Greek Cypriot examined also service quality in banks and
found out that reliability was the strongest predictor of service quality and customer satisfaction.
Studies by Newman (2001), using the SERVQUAL model in the United Kingdom has shown
that, an un-weighted SERVQUAL measure failed to gauge customer’s priorities across the five
service quality dimensions and was insensitive to customer product ownership and service
encounter. The list of studies is almost endless.

Modified SERVQUAL Models for Bank Service Quality

Due to the criticisms against the SERVQUAL model (Cronin and Taylor, 1992), other
researchers have modified the dimensions by adding or deleting variables in order to determine
service quality. Narteh (2013a), used a modified scale consisting of reliability, responsiveness,
ease of use, convenience, fulfillment, security, and accuracy, which he termed, ATMqual, to
measure ATM service quality. The results of the study showed that only security and privacy
were not major ATM service quality issues in the Ghanaian context. Further, investigation by
Yavas et al., (1997) in Turkey applied three dimensions in the SERVQUAL model; tangibles,
responsiveness and empathy to examine the effects of service quality on customer satisfaction,
complaint behavior and commitment. The findings of the study showed that, empathy mostly
predicted customer satisfaction, complaint behaviour and commitment. The study also echoed
the need to examine the cultural context within which the SERVQUAL model could be applied.
Bloemer et al., (1998) in the Netherlands used reliability, empathy, efficiency, interest rates,
procedures, expertise, access to money to examine service quality and satisfaction and its
impacts on customer loyalty. Reliability was observed to be the most important variable

5
 influencing customer loyalty. In addition, studies by Hossain and Leo (2009) in Qatar, using 4
variables of reliability, tangibles, competence and empathy to measure customer perception of
service quality showed that tangibles had high ratings on service quality in retail banks. Other
researchers, (Korda and Snoj, 2010), also modified the SERVQUAL to measure service quality
in retail banks in Slovenia.

New Models Used for Bank Service Quality

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The inability of both the SERVQUAL and the modified SERVQUAL instruments to capture all
the dimensions of retail bank service quality motivated other researchers to develop models and
new scales to measure retail bank service quality. Aldaigan and Buttle (2002), developed the
SYSTRA-SQ model consisting of System/Organizational and Transactional dimensions of
service performance and quality, to measure service quality in UK banks. The study found that,
the organization service system and transactional quality of banks significantly predicts service
quality and satisfaction of customers. Similarly, Bahia and Nantel (2000) developed the BSQ
model, consisting of 31 items and six dimensions; tangibles, price, access, effectiveness and
assurance, service portfolios and reliability, to measure bank service quality in Canada. The
study concluded that, effectiveness, price and reliability were dominant and significant
dimensions of service quality. In addition, the study concluded that dimensions in the BSQ
model were more reliable than SERVQUAL dimensions.

Like the SERVQUAL model, the BSQ model has also been widely applied to measure service
quality in retail banks. For instance, Glaveli et al., (2006) used the BSQ model to measure
service quality in the context of five Balkan countries (Bulgaria, Albania, FYROM, Serbia and
Greece) and found out that the indicators performed differently based on the context of the study.
The findings from these studies revealed that, effectiveness, assurance and service portfolio were
highly significant in Greece, while, tangibles, reliability and service portfolio were significant
dimensions in the Bulgarian context (Petridou et al., 2007). In addition, price and assurance
(Serbia), service portfolio, reliability (Albania), effectiveness and price (FYROM) were found to
be significant dimensions of bank service quality in these countries. Moreover, Petridou et al.,

6
 (2007) also used the BSQ scale to measure service quality in the retail banks of Greece and
Bulgaria. The study found differences in customer evaluations of the dimensions of the model
and attributed this to differences in the economic environment of the two countries. Earlier on,
McDougal and Levesque (1994) used outcome, process, competitive interest rates, convenience
and tangibles to measure service quality and found that all the indicators significantly measured
retail banking service quality in Canada. In addition, Avkiran (1994) examined service quality
and satisfaction, with the constructs of staff conduct, communication, credibility, responsiveness,
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access to branch management and teller services. The findings of the study showed that out of
the six dimensions conceptualized, four dimensions were found to be significant in influencing
customer satisfaction. Staff conduct, communication, access to teller services and credibility,
significantly predicted customer satisfaction. Karatepe et al., (2005) and Karatepe (2011),
examined service quality in Cyprus using service environment, reliability, empathy and
interaction quality and found that interaction quality was rated high in determining service
quality. Moreover, Hossainet al., (2014) validated some scales of Karatepe (2011) with studies in
Australia and Bangladesh, and found that interaction quality has the greatest significance in
influencing service quality and customer satisfaction. With regard to differentiation between
private and public banks, Kuara et al., (2013) used tangibility, information technology and
human behavior to measure service quality and performance in private and public banks and
found that the private banks recorded a better performance under human behaviour, tangibility
and information technology while public banks performed better in price and fairness.

The review revealed that reliability, tangibles and assurance are the most commonly used
variables to measure retail bank service quality (Ladhari et al., 2011; Arasli, 2005; Narteh,
2013b; Bloemer et al., 1998; Bahia and Nantel, 2000; Petridou et al., 2007; Glaveli et al., 2006).
Moreover, the most popular models used are the SERVQUAL and the BSQ models. These
models were used independent of the other without any attempt at integration. This study set out
among others to address this research gap by integrating the SERVQUAL and the BSQ models
to measure retail bank service quality. This approach responds to the call by Chodhury (2013) for
modification of existing scales in order to measure retail bank service quality.
Bank Service quality and Customer satisfaction

7
 Customer satisfaction is an important concept in consumer research. It is linked to a number of
business outcomes such as customer loyalty resulting in the payment of premium prices, re-
purchase intentions and positive word- of- mouth (Jamal and Naser, 2002; Al-Eisa and
Alhemoud, 2009; Senic and Marinkovic, 2014) and provides the basis for sustained competitive
advantage (Midoro et al., 2005). There is general agreement in the literature that customer
satisfaction is a post consumption experience and as such, Olorunniwo et al., (2006) cited in Al-
Eisa and Alhemoud, (2009) conceptualized customer satisfaction as a customer’s fulfillment
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response following the consumption experience. In the same way, customer satisfaction is
viewed as the individual’s perception of the performance of the product or service in relation to
expectations (Torres and Kline, 2006). Similarly, Kotler and Keller (2013: p.110) defined
customer satisfaction as “a person’s feeling of pleasure or disappointment which resulted from
comparing a product’s perceived performance or outcome against his or her expectations”. Two
issues of satisfaction have often been raised in the literature. Whether to evaluate it on a
transaction- specific basis or evaluate it in terms of overall or cumulative experience (A and
Chatzipanagiotou, 2009). While the former considers satisfaction to be a “post-choice evaluative
judgement of a specific purchase occasion” (Anderson et al., 1994), the later views satisfaction
2across a series of purchase occasions, thereby resulting in an overall evaluation over time.

Retail banking is a high involvement service characterized mostly by frequent and long- term
interactions. As a result, customers are likely to visit their banks over a number of times within a
period to enable them conduct their transactions which makes it imperative to evaluate their
satisfaction over time across a number of transactions. As a result, the current study views
satisfaction as an overall judgement of customers of a firm’s products and services over a
defined period. This means the study adopts the cumulative measure of satisfaction which is
consistent with the works of (Oliver et al., 1997; Torres and Kline, 2006; and Theodoridis and
Chatzipanagiotou, 2009). The nine variables which measure bank service quality are posited to
have a positive relationship with customer satisfaction and are discussed in the hypothesis in the
next section.

Model and hypothesis development

8
 The aim of the study is to develop an integrated framework for measuring retail bank service
quality. An integration of the SERVQUAL and BSQ models resulted in 9 variables which
formed the basis of the framework for the study. The nine constructs are tangibles, reliability,
assurance, empathy, responsiveness, access, price, effectiveness and service portfolios. Price on
the other hand is seen as a moderator of this relationship. Tangibles and reliability appeared in
both scales and were therefore used only once. The model is illustrated in Figure 1. The next
section is used to discuss variables of the model and the hypothesized relationships.
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Insert Figure 1

Tangibles
Mersha et al., (2012) opined that the tangible dimension is what makes a product or service
practical and usable for customers. In most cases, tangible evidence is limited to the service
provider's physical facilities, equipment, and personnel (Parasuraman et al., 1985: p.42).
Mukherjee et al., (2003) found that investing in tangible features alone cannot solve customer
dissatisfaction problems in banks. A study conducted in Tunisia and Canada showed that the
tangible dimension was of little consequence to customer service quality perception (Landhari et
al., 2011). Brady and Cronin (2001) also concluded that the tangibles dimension is not identified
as a descriptor because customers use tangibles as a proxy for evaluating service outcomes.
However, the studies of Petridou et al., (2007) in Bulgaria found the importance of tangibles in
predicting customer satisfaction in retail banks. The need for further clarity is on the construct is
obvious. Therefore, the first hypothesis for the study is stated as:

H1: Tangibles is significantly and positively related to customer satisfaction in the Ghanaian
retail banks

Reliability

9
 Reliability is one of the most used indicators to measure service quality and has mostly been
found to be the strongest predictor of customer satisfaction (Wolfinbarger and Gilly, 2003). It is
described as the ability of service organizations to deliver good quality service (AbuKhalifeh and
Som, 2012). Reliability represents service firms’ ability to perform promised services
dependably and accurately (Parasuraman et al., 1988). Reliability of banking service therefore
means that there must be accuracy in billing; keeping accurate records as well as performing the
service at the designated time. Kumar et al., (2010) found that reliability greatly influences
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customer perception of bank service quality in Malaysia while Cui et al., (2003) also noted it to
be a significant service quality in Korean banking institutions. Similarly, Lardhari et al., (2011)
found that it predicts customer satisfaction in both an advanced Western country of Canada and
an emerging African developing economy of Tunisia. Chouldhary (2013) in India also found
reliability to be the greatest in predicting customer satisfaction. This shows its universal
relevance in predicting service quality in retail banks. The second hypothesis guiding the study is
given as:

H2: Reliability significantly predicts service quality and customer satisfaction in retail banks in
Ghana.

Responsiveness
Responsiveness describes the desire, willingness and readiness of service providers to assist
customers and deliver prompt service (Abdullah et al., 2011). It requires bank services such as
mailing a transaction slip, calling the customer back, and complaint handling to be delivered
timeously. Responsiveness is critical for customer perception of bank service quality and that,
banks must ensure that they are responsive in all fronts of customer engagements (Abdullah et
al., 2011; Kumar et al., 2009). Kumar et al. (2009) notes that, the “ability to conduct transaction
in a short waiting period greatly influence customer perception of service quality and results in
the reduction in loss of customers’ loyalty and the opportunities of cross-selling as well as
customer attrition”. Responsiveness also measures the extent to which banks recover failed
service (Priluck and Lala, 2009) and has a positive relationship with customer satisfaction
(Magnini et al., 2007). In retail banking, Ravichandran et al., (2010) and Lardhari et al., (2011)

10
 found the importance of the construct in predicting customer satisfaction. Ghanaian retail banks
are quick at responding to customer complaints and are using various techniques to manage
queues in the banking industry. As such, we hypothesise that;

H3: Responsiveness of banks will be positively and significantly related to customer satisfaction
in the Ghanaian retail banks.
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Assurance
Service quality assurance presupposes that employees have knowledge about the bank products
and services, are courteous towards customers and can inspire trust and confidence among
customers (Kumar, et al., 2010; Arasli et al., 2005). Thus, assurance is born out of the interaction
between customers and bankers. The expression of respect, gratitude, friendliness and
willingness to help customers in the service arena culminate in customer judgment of service
quality (Kumar et al., 2009). Kumar et al. (2009) found assurance as an indicator which
influences service quality perception in Malaysian banks and that it also influenced customer’s
judgment of employee competence which is crucial in building customer trust. Assurance was
found as a highly significant service quality dimension in Greece (Petridou et al., 2007) and in
Serbia (Glaveli et al., 2006). Similarly, studies by Siddiqi (2011) in Bangladesh also confirmed
that assurance highly predicts customer satisfaction. Therefore, we hypothesize that:

H4: Assurance by retail banks to customers will positively predict satisfaction with retail bank
services in Ghana.

Empathy

Empathy concerns the provision of care and individualized attention to customers (Parasuraman
et al., 1988). Thus, customers must be contacted on personalized basis and prefer services to be
rendered to suit their preferences (AbuKhalifeh and Som, 2012). Tsoukatos and Rand (2006)
argued that service firms such as those in the banking industry, show empathy by ensuring

11
 customers are given individual attention; service operating hours are convenient and services
rendered with customers’ best interests at heart as well as understanding specific needs of each
customer. Kumar et al., (2009) posit that Malaysian customers place much premium on
convenient working hours by banks. Similarly, studies by Siddiqi (2011) in Bangladesh
confirmed that empathy highly predicts customer satisfaction. Ghana as country is noted to show
high care and individual attention to people. This behaviour if reflected in bank customers can
lead to customer satisfaction. The next hypothesis is stated as:
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H5: Empathy shown to customers will significantly influence their satisfaction with retail
banking services in Ghana

Access
Convenient access is of prime importance to banks and their customers as most customers expect
to transact with their banks freely everywhere they go. This is a contribution to the prevailing
thinking that today’s customers are demanding and stress on high service quality. Consequently,
banks have considered the option of introducing SSTs (Eriksson and Nilsson, 2007) such as the
ATMs (Narteh, 2013a), telephone banking (Akturan and Tezcan, 2012) and internet banking
(Laforet and Li, 2005). These innovations improve general access to retail bank services and
could impact positively on customer satisfaction. Access also relates to the ease with which
customers can visit their bank branches and transact with tellers. The BSQ model views access as
a critical service quality dimension (Bahia and Nantel, 2000). Avikiran (1994) found in Australia
that access to bank branches and teller services greatly influenced customer satisfaction.
However, access was lowly ranked as a service quality dimension in the studies of Petridou et al,
(2007) and Glaveli et al., (2006). The Ghanaian Banking industry has 28 banks with a number
of bank branches which are well equipped with teller services. This will likely improve customer
satisfaction with access to retail bank services in Ghana. It is therefore stated for this study that:

H6: Access will improve service quality and positively increase customer satisfaction with retail
bank services in Ghana.

12
 Service portfolios
Service portfolio represents the bouquet of services that the service provider offers. Consumers
perceive bundled services as likely to perform better than non-bundled ones due to the fact that
individual services in the portfolio are thought to function together (Liu and Hu, 2011). Bahia
and Nantel (2000) in the BSQ model defined service portfolio as the range, consistency and
innovation products. In the banking industry, customers expect a complete range of services and
these must be communicated and provided to them appropriately. The service quality perception
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of a bank which keeps on introducing new and innovative products is likely to be rated high by
most customers. New product development is a constant phenomenon in the Ghanaian banking
industry (Ghana banking Survey, 2011). The influence of technology has helped to drive new
processes, products and services in the sector. For instance, cheque clearing time has reduced
drastically among banks, while mobile and telephone banking opportunities abound. The
availability of ATMs, Internet banking and SMS alert has also brought new communication
techniques with customers. These are likely to have positive developments on customer
behaviour in the retail banks. The study states that:

H7: Service portfolios will significantly influence customer satisfaction in the retail banks in
Ghana.

Effectiveness
Effectiveness refers to the effectual delivery of service and the ability of staff to inspire feeling
of security (Spathis, Petridou, and Glaveli, 2004). It can further be interpreted to be the existence
of harmony among personnel, the successful delivery of service, and the ability to incite feelings
of safety. Due to the fact that banking is a service based sector, constrained by the peculiar
characteristics of service, the customer-employee contact and its effectiveness has a major
impact on the formation of customer perception of the service quality received (Gummerson,
1998). Effectiveness is closely connected to confidence in the banking system (Spathis et al.,
2006). Previous research has shown that a high touch in the service delivery characterized by
personal connectivity, rather than a high-tech approach (Malhotra et al., 2005) accentuate the
role that effectiveness play in having a satisfied bank customer. This is consistent with both the

13
 majority of SERVQUAL studies (Tsoukatos, 2009) and the BSQ study in which effectiveness
was found to be the most important dimension of service quality (Bahia and Nantel, 2000).
Tsoukatos and Mastrojianni (2010) however opined that effectiveness is not the most important
dimension of service quality in the banking sector. In spite of that, most studies concur that
effectiveness is a key dimension of service quality in the banking sector. This leads to this
hypothesis of the study that:
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H8: Effectiveness is positively and significantly related to customer satisfaction in retail banks in
Ghana

The Moderating role of Price

Price is the monetary value placed on goods and services offered by the service providers to their
customers. Gerrard and Cunningham, (2001) are of the view that pricing incidents have to do
with high prices, price increases, unfair and deceptive pricing and general problems associated
with fees, charges, rates and price deals related to the service. Banks generally have a wide range
of pricing options and the price that customers pay is generally dependent on volume and value
of transactions, personal relationship with the bank and bargaining power of the customers.
Research indicates that the price-quality link has not been well researched (Kim et al.,2006,
Toncar et al., 2010). Prior studies have shown that high prices lead to high consumers’
perception of high quality of goods and services and vice versa. In a recent study, Toncar et al.,
(2010) found out that the degree to which customer’s price expectations are met influences their
service quality perceptions. This makes us believe the price customers expect to pay will have a
bearing on their service quality expectations. Expected price is defined as the price which a
consumer thinks he/she will have to pay for a defined service (Toncar et al., 2010).

Pricing has been a contentious issue in the Ghanaian banking industry and most customers
believe that the services are overpriced. Researchers like Gockel and Mensah, (2006) found that
there is a wide spread between savings and lending rates in the Ghanaian banking industry which
makes the cost of funds very expensive. Kim et al., (2006) indicate that price fairness influences
trust and satisfaction of the customer to the service provider. If customers perceive that they are

14
 being overcharged, they will not trust the bank; and will be more likely to switch (Andaleeb and
Caskey, 2007). Narteh (2013b) found out that pricing is a factor that influence customer
switching of retail banks in Ghana. We therefore argue that prices will influence customer
service quality expectations in the bank and influence their future behavioural intentions.

H9: Price moderates the relationship between service quality and customer satisfaction with
retail bank services in Ghana.
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Methodology
Research setting
The study aims at investigating service quality and customer satisfaction with retail bank service.
Consistent with most studies on bank service quality (Petridou et al., 2007, Glaveli et al., 2006,
Hinson et al., 2011), the current study is quantitative, using the survey method to gather data
from respondents. The sample frame for the study is all the 28 banks operating in Ghana as at
June 2015. Letters were sent to all the banks, explained the rationale of the study and requested
their permission to participate. At the end of three weeks, 18 banks responded favourably to the
requests and were used in the study. A list of customers who have opened current or savings
accounts with the banks for at least one year (so they can rate the banks’ service quality and
satisfaction) were obtained from the participating banks to serve as the respondents of the study.
1800 respondents (50 from each bank) was used.

Questionnaire was the data collection tool. The items of the questionnaire were anchored on a
five point Likert scale with 1 labeled as “strong disagree” and 5 labeled as “strongly agree”.
The questionnaire was divided into three sections as: (i) personal information on respondents (ii)
dimensions of bank service quality (iii) customer satisfaction. The items of the questionnaires
were adopted from the SERVQUAL model (Parasuraman et al., 1988); BSQ index (Petridou et
al., 2007; Glaveli et al., 2006; Abdullah et al., 2011). Customer satisfaction was conceptualised
as an overall satisfaction rather than transaction-specific post purchase evaluation. A five- item
questionnaire was adopted from the works of Al-Eisa and Alhemoud, (2009); Theodoridis and
Chatzipanagiotou, 2009) and Fornell, (1992). The five items explored both customer’s overall
15
 satisfaction as well as their intention to continue to do business with the bank. To reduce
potential bias resulting from forced response, “N/A” was included on each question as an option.

To ensure the validity of the questionnaire these steps were undertake. Two professors with
special research focus on bank marketing were first contacted to review the research instrument
in terms of contents and wording. Their recommendations were used to restructure the
questionnaire. The resulting questionnaire was piloted -tested with 20 Executive MBA students
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of the University of Ghana Business School with wide experience in banking. Their responses
further ensured that the contents and wording was improved to reflect the banking sector. Thus
the research instrument was considered valid to be administered. As English language is the
official language in Ghana, the respondents, both native and foreign spoke and understand a fair
amount of the language and therefore there was no need for translation of the research
instrument.

Two research assistants were hired and trained in the survey design and questionnaire
administration. At the end of one month, a sample size of 560 respondents was collected out of a
total 860 questionnaires administered to respondents. The Ghanaian banking industry has an
almost equal number of foreign and local banks. Ten of the banks contacted were local banks
while the remaining eight were foreign owned. However, all the banking halls were manned by
Ghanaian staff which ensured that services delivered was almost homogenous across the banks.
The approach adopted is consistent with earlier studies by Narteh and Owusu-Frimpong (2011),
Blankson et al., (2009) and Hinson et al., (2011) in the Ghanaian banking industry.

Control

Studies have shown that demographic variables normally impact on customer satisfaction
behaviours (Jamal and Naser, 2002; Omar, 2008; Stombec and Wakefield, 2008). As such, to
partial out the effects of the demographic variables on the relationship between service quality
and customer satisfaction, we controlled for the effects of age, education, gender, occupation and
ownership of banks.

16
 Based on the recommendations of Hair et al., (2010), Confirmatory Factor analysis using AMOS
version 22.0 was used to estimate the relationship between bank service quality and customer
satisfaction.

Demographic Profile of the respondents

Descriptive analysis indicates that 50.9% of the respondents were male while 49.1% were
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female. Majority of the respondents (52.4) were aged from 20-30 years. There were also 33.0%
within the ages of 31-40 and about 12.1% within the ages of 41-50. Approximately 1.2% each of
the sampled respondents were below 20 years or above 50 years respectively. On the education,
majority of the respondents (86.9%) had degrees or post graduate degrees. Similarly, about
65.5% of the respondents were salaried employees, 26.7 % were students while 7.6 % were self-
employed with only 0.3% described as unemployed. Furthermore, nationality statistics of the
respondents indicated that 80.9% were Ghanaians whereas the remaining 19.1% were foreigners.
Finally, about 82 % had dealt with their banks for more than five years. The remaining 18% were
customers who have dealt with their banks for either 5 years or below. Table I below represents
the demographic profile of the sampled respondents for the survey.

Insert Table I

Confirmatory Factor Analysis

Structuring Equation modeling (SEM) using Amos 22.0 was used for measurement scale
validation and structural analysis. The two-step process, as suggested by Anderson and Gerbing,
(1988), using a confirmatory factor analysis and structural analysis was adopted. The estimation
of the structural model is done after the measurement model is assessed (Hair et al., 2010). The
measurement model involves conducting a confirmatory factor analysis (CFA) for assessing the
contribution of each indicator variable and for measuring the adequacy of the measurement
model. Model specification is the first step in which the adequate sample size of 560 and the

17
 multivariate normality distribution in the data set guaranteed the use of the maximum likelihood
method in the estimation (Byrne et al., 2010).

In the second stage, an iterative model specification is done in order to develop the best set of
items to represent a construct through refinement and retesting. At this stage, items that do not
meet the validity and reliability tests are dropped (Byrne et al., 2010). The final stage is the
estimation of the goodness of fit (GOF) parameters of the overall model to test the extent to
which the data support the research model. The most commonly used parameters are the
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likelihood ratio chi-square (χ2), the ratio of χ2 to degrees of freedom (χ2/df), the root mean square
error of approximation (RMSEA), and comparative fit index (CFI). As indicated in Table II, the
measurement model results showed a very good model fit with χ2 = 708.66 (df = 428), χ2/df =
1.66, CFI=0.958, TLI =0.952 and NFI=0.902. The RMSEA was 0.045, PCFI = 0.827 and PNFI
= 0.778.

Reliability and validity Test

Two types of reliability tests were used in this study and they include internal consistency and
construct reliability (Fornell and Lacker 1981; Hair, et al. 2010). Cronbach alpha coefficients,
through SPSS version 20.0 was used to test the internal consistency of the instrument. The alpha
coefficient measures the extent to which the multiple indicators for a latent variable cluster
together. For unidimensional scales, a Cronbach alpha value of 0.6 or more is considered
acceptable (Nunnally 1978). The results indicate high Cronbach alpha results for the items
ranging between 0.6 and 0.9 as provided in Table II. For structural equation modeling, construct
reliability is measured using composite reliability (CR) because it is more parsimonious than the
Cronbach alpha (Bagozzi and Yi, 1988). Thus, in Table II CR values also range from 0.8 to 0.9,
which are in excess of the recommended threshold value of 0.7 (Hair et al., 2010).

According to Hair et al., (2010), validity measures the extent to which the set of indicators
accurately represent a construct. In this study, two measures of validity were tested; convergent
validity and discriminant validity. Convergent validity measures the degree to which the items
truly represent the intended latent construct. Convergent validity is therefore assessed by factor
loadings and average variance extracted (Hair et al., 2010). A rule of thumb is that the factor
18
 loadings should be at least 0.50 and ideally 0.7 or higher while all factor loadings should be
statistically significant (Hair et al., 2010). Following the rules described above, 9 items were
deleted from their indicators because of low loadings, re-specifications and retesting. In addition,
the average variance extracted (AVE) from items by their respective constructs should be greater
than the variance unexplained (i.e. AVE > 0.50). The results presented in Table III indicate AVE
values between 0.5 and 0.79. The values are all greater than 0.50, thereby meeting the AVE
criteria set by Fornell and Larcker, (1981). The loadings and the AVE results indicated
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convergent validity.

Discriminant validity measures the extent to which latent factors are distinct i.e., they should not
correlate so highly that they seem to measure the same underlying dimension (Siekpe, 2005).
Discriminant validity is established if the AVE of a variable (within factor shared variance) is
larger than the squared correlation coefficients between variables (Fornell and Larcker, 1981).
The results in Table III provides support to indicate strong discriminant validity.

Insert Table II

Insert Table III

Structural Model

The hypothesized structural model was then estimated to assess path estimates and overall model
fit. The analysis demonstrated an acceptable fit to the data. The major fit indices are: χ2 =
708.66, χ2 / df= 1.66, CFI= 0.958, TLI= 0.952, NFI= 902. RMSEA= 0.045, PNFI= 0.778. The
constructs and the specified paths account for a significant portion of the variance in the
endogenous constructs posited.

Insert Table III

19
 The result of the hypothesis testing is indicated in Table IV. In the initial model, (i.e. direct
relationship), five of the proposed hypothesis were significant in predicting customer
satisfaction. In order of importance, the results reveal that customer satisfaction is influenced by
“Empathy” (β = 0.665, p < 0.001), “Reliability” (β = 1.681, p < 0.01), “Price” (β=1.408, p <
0.001), “Tangible” (β = 1.034, p < 0.001) and “Assurance” (β = 1.408, p < 0.001). The result
shows that service quality dimensions explained 0.69 or 69% variation in customer satisfaction.

In the second model, the moderated result indicates that in addition to the four (less price)
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service quality dimensions that were already significant in predicting customer satisfaction, three
others namely access, service portfolio and responsiveness were also significant predictors of
customer satisfaction.

Insert Table IV

Discussion
This study was conducted to determine the dimensions of bank service quality and how they
predict customer satisfaction in the Ghanaian banking industry. An integration of the
SERVQUAL and the BSQ scales was used to measure bank service quality and how they
predicted customer satisfaction with the result being moderated with price. The results indicate
that, a 29-item scale, consisting of the five constructs of the SERVQUAL scale (Tangibles,
Reliability, Assurance, Responsiveness and Empathy) and four factors from the BSQ scale
(Service portfolio, Access, Effectiveness and Price) determined bank service quality in the
Ghanaian banking industry. The finding resonates with authors who have advocated for a
modification of the SERVQUAL scale in other to measure bank service quality (Choudhury,
2013). The banking environment in Ghana keeps changing due to government legislations and
the influence of technology on service delivery and as such, customer perceptions of what
constitutes service quality keep changing over time. It is necessary for regular assessment of
service quality in order to identify and implement measures that meet and exceed customer

20
 needs. All the nine service quality factors found in this study have their own unique
characteristics embedded in the Ghanaian banking sector.

In addition, the results of the direct model indicated that the 5 service quality indicators
(Tangibles, Assurance, Reliability, Empathy, Price) predicted customer satisfaction in the
banking industry in Ghana. This finding supports the burgeoning field of research that has shown
positive relationships between service quality dimensions and customer satisfaction in retail
banking (Arasli et al., 2005, Lardhari et al., 2011; Ravichandran et al., 2010, Siddiqi, 2011,
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Hossain et al., 2014). Customer satisfaction is a major goal for the management of retail banks
because of its positive impact on employee behaviour (Gera, 2011, Siddiqi, 2011) and firm
performance (Agathee 2010; Jain and Gupta, 2004).

The moderated result indicates that seven service quality dimensions predicted customer
satisfaction. Three more indicators (Responsiveness, Access, Service portfolios) in addition to
the four factors already mentioned (price was used as the moderator), became significant
predictors of customer satisfaction. Only effectiveness was not significant in both cases. This
indicates that the introduction of prices as a moderator improved the model and made more
indicators significant predictors of customer satisfaction.

The controls also provided some insight into the model. Age, education and occupation were
significant while gender and bank ownership were not significant. On bank ownership, the
results may be an indication that both local and foreign banks have similar levels of service
delivery. The use of training and technology has reduced differences in service delivery among
these banks. The introduction of self-service technologies such as ATMs, internet banking and
SMS alerts, which are to some extent dependent on the performance of external network service
providers have blurred service delivery gaps among the banks. The other significant results on
occupation, education and occupation are consistent with the literature (Jamal and Naser, 2002).

Assurance was the highly-ranked bank service quality indicator that predicted customer
satisfaction. The two variables that loaded on the assurance factor denotes how employees feel
safe while conducting their banking transactions and the confidence that customers repose in the
skills and knowledge of employees to respond to their needs and requests. Banking transactions
21
 are full of risks and employees must feel safe in using the services such as ATMs and internet
banking and should not be amenable to fraudulent deals. Moreover, service failure in banking is
almost inevitable and employees must have the skill and knowledge to address them. The
findings confirmed the results from the studies of Petridou et al., (2007) and Siddiqi, (2011) who
found support for assurance as a significant retail bank service quality indicator.
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Pricing was also significant in predicting customer satisfaction. The pricing indicator loaded with
four variables, which shows the importance of pricing to the customers of an emerging market
like Ghana. Pricing in retail banking is a major issue in Ghana as most customers are of the view
that bank charges and other rates are unfair and unreasonable (Narteh, 2013b). The study found
that the way prices are fixed, the charges that are levied on services provided by the banks and
the extent to which price reviews are communicated to customers are significant quality
dimensions cherished by Ghanaian retail bank customers. The results indicate that the price
customers pay has an indication on their quality perception of banking services in Ghana. Price
communicates quality in the absence of further cues. The result confirms the study of Narteh
(2013b) who found poor pricing to be a factor that influenced customer’s switching banks in
Ghana. The results also support the works of Kim et al., (2006) who found a positive and
significant relationship between price fairness and customer satisfaction.

Moreover, Tangibility also emerged as a bank service quality factor that predicts customer
satisfaction. The buildings and other physical facilities of the bank, modern looking equipment
and above all, the general appearance of staff were all critical in improving customer satisfaction.
A clean environment and physical facilities as well as neat appearance of employees create good
image of the bank which impacts positively on customer satisfaction with retail bank services.
Tangibility has consistently appeared as a critical retail bank service quality dimension which
significantly influences the service behaviour of customers (Petridou et al., 2007; Glaveli et al.,
2006; of Hossain and Leo 2009. For instance, Tangibility was found to be an important service
quality dimension among Bulgarian retail bank customers (Glaveli et al., 2006). In addition, the

22
 study also confirms the results of Hossain and Leo (2009) in Quarter who found Tangibility as an
important service quality dimension. Our results run counter to other studies (Lardhari et al.,
2011; Mukherjee et al., 2003; Brady and Cronin, 2001) who found that Tangibility has no impact
on customer satisfaction in retail banking services. The result may be an indication that the
Ghanaian banking industry is still growing and tangible issues are still critical to customers.

Access, was also significant in predicting retail customers’ satisfaction with bank services in
Ghana. Access involves the availability of teller services and networked bank branches (Narteh,
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2013a) which provide customers with opportunities to obtain the banking services. Moreover, it
also measures the queuing system in the banks- whether queues are slow and whether a fair
system of first-come- first -serve is practiced in the banks. Access was found as a middle rank
retail bank service quality dimension in this study which is consistent with previous research
(Glaveli et al., 2006, Bahia and Nantel, 2000). The issue which accessibility seems to address is
either taken for granted or seen to form part of the core service delivery of the banks. For
instance, it is taken for granted that all retail banks will have adequate branches, tellers and
electronic products and manage the queuing system very well.

Reliability connotes the ability of customers to deliver error free services as and when promised.
The indicator has been consistently used to measure service quality in retail banking. Two
variables that loaded on the reliability factor deals with the promise by the banks to deliver error
free services at the right time. The need to have clear service standards, communicated through
service blue prints provide a measure of what customers expect as they visit their retail banks.
The study confirms findings from the researches (Berry et al., 1988; Bloermer et al., 1998;
Arasli et al., 2005; Gera, 2011; Ladhari et al., 2011) who found that reliability is an important
service quality dimension which also influences customer satisfaction in retail banks.

Conclusions and implications of the study

The current study has made a major theoretical contribution to service quality in retail banking
literature. Choudhury, (2013) called on researchers to modify existing scales in order to help
23
 address the issues of retail bank service quality because not all the dimensions of the
SERVQUAL model are relevant in every context for examining service quality. The current
study has taken a giant step towards realizing this goal and has proposed and tested a new model,
which is an integration of the SERVQUAL and BSQ models to measure retail bank service
quality. The nine- factor model consisting, of five factors of the SERVQUAL model (Empathy,
Assurance, Reliability, Responsiveness and Tangible) and four factors of the BSQ model
(Service portfolio, Price, Effectiveness and Access) is a significant addition to the literature.
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Prior to this study, the scales were treated differently and were never integrated for any study.
We have shown from this study that an integration of existing scales provides a broader scale and
promise for retail bank service quality research.

Moreover, prior studies have often assumed a direct relationship between retail bank service
quality dimensions and customer satisfaction (Landhari et al., 2011; Priluck and Lala, 2009).
When we moderated the relationship with price, we saw a significant improvement in
responsiveness, access and service portfolios in predicting customer satisfaction. This means that
the price customers pay for their retail bank services heightens their service quality expectations.
Managers of retail banks who intend to shape the service quality perceptions of their customers
could integrate this with appropriate pricing mechanisms in order to realise this goal. Similarly,
the study has answered the call by Bricks et al., (2010) for specific country studies of service
quality in retail banks in Sub-Saharan Africa. The current study focused on Ghana, one of the
promising and emerging countries in the sub-region.

In addition, the direct and moderated models found that eight service quality indicators used in
this study have positive impact on customer satisfaction. A practical implication of the results is
that it has provided critical issues for bank mangers to focus on in order to compete favourably in
the Ghanaian banking sector to help delight customers. Managers of banks must focus and
communicate their service quality in terms of Reliability, Price, Access, Tangibles, Assurance,
Empathy, Responsiness, Effectiveness and Service portfolios in order to meet customers’
expectation, satisfy and retain them.

24
 Finally, the study has some limitation which must be considered when interpreting the results.
The study was conducted in one city –Accra using mostly an elitist clientele. The views of the
extended population from other cities and including the less educated was not considered. Future
research could replicate such studies in other countries with more a mixture of different
respondents. Moreover, Hossain et al., (2014) argued that changes in economic conditions can
affect customers’ quality perceptions and called for more longitudinal studies to capture service
quality perceptions of customers over time. This study supports such sentiments since the current
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study was cross-sectional. The study found out that ownership of banks did not affect the
significance of the results. This is intuitively surprising as one might think that foreign banks
with their sophisticated technology, management style and capital may deliver superior service
quality than local banks. A further study could compare service quality dimensions among local
and foreign banks in order to clarify and throw more light on this issue. Finally, the study has
integrated just two models-BSQ and SERVQUAL models. Marketing literature has identified
many service quality models such as BANKSERV, SYSTRAQ etc. Future studies must consider
integrating such models so that the field can benefit from broader scales for measuring service
quality in retail banks. It is our hope that the field of marketing will benefit more with this
approach.

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Biographies

Dr. Bedman Narteh is an Associate professor and former Head of Marketing, at the University of
Ghana Business School. He holds a PhD from Aalborg University, Denmark, an MBA and a
BSc. degree from the University of Ghana Business School. He has researched and published
extensively in the Thunderbird Business Review, Managing Service Quality, Management
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Research Review, Journal of Hospitality Marketing and Management, International Journal of

Bank Marketing and Journal of Knowledge Management among others.

APPENDIX

Bank Service Customer

Quality Satisfaction

Price

Figure 1: Research Model

Table I – Descriptive Profile of respondents

Profile of respondents Sample composition

N %
Gender
Male 285 50.9
Female 275 49.1

Age (in years)

Below 20 7 1.2
20 – 30 293 52.4
31 – 40 185 33.0

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 41 – 50 68 12.1
Above 50 7 1.2

Educational Qualification
JHS/SHS 8 1.5
Tertiary 236 42.1
Post Graduate 251 44.8
Professional 65 11.5

Occupation
Student 150 26.7
Salaried 367 65.5
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Employee
Self-employed 42 7.6
Unemployed 1 0.3

Nationality
Foreign 144 25.7
Local 416 74.3

Number of years dealing with Bank

Below 5 96 17.1
6 – 10 293 52.3
11 – 20 150 26.8
Above 20 21 3.8

Note: n=560

Table II: Measurement Model: Constructs, Items, Loadings and Reliability Estimates

Item Description Loadings Cronbach CR AVE

(t-value) Alpha
Tangibles 0.70 0.78 0.54
The physical facilities are visually appealing 0.71(fixed)
Staff at my bank are professional and neat in appearance 0.75(11.30***)
My bank has modern equipment 0.75(11.30***)
Reliability 0.74 0.78 0.54
Staff at m; bank perform services at the right time 0.79(fixed)
Staff tell customers exactly when services will be performed 0.78(14.29***)
My bank provides a precise filing system 0.62(11.15***)

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 Responsiveness 0.86 0.87 0.54
Staff at my bank give prompt service to customers 0.72(fixed)
Staff are never too busy to respond to customers request 0.69(12.23***)
Staff at my bank have convenient hours for all their customers 0.68(11.90***)
Staff are consistently courteous with their customers 0.77(13.67***)
Staff understand the specific needs of their customers 0.72(12.65***)
Staff at my bank are always willing to help customers 0.81(14.33***)
Service Portfolio 0.76 0.78 0.64
My bank provides internet banking 0.82(fixed)
My bank provides sms banking 0.77(8.67***)
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Assurance 0.80 0.87 0.77

Customers feel safe while services are being provided by my bank 0.88(fixed)
I have a feeling of safety when doing bank transactions 0.87(16.03***)
Price 0.77 0.88 0.55
Interest on loans are reasonable 0.62(fixed)
The bank contacts me whenever there is a service charge review 0.77(11.14***)
The bank provides me with good explanations of service fees 0.87(12.08***)
The bank provides reasonable fees for administration of accounts 0.76(11.03***)
The bank keeps me informed whenever there is new service 0.76(11.01***)
solution
There is precision on my account statements 0.64(9.71***)
Empathy 0.87 0.81 0.59
Staff show sincere interest in solving customers problems 0.84(fixed)
Staff have knowledge to answer customers questions 0.69(13.66***)
Staff have customers best interest at heart 0.77(15.61***)
Access 0.80 0.86 0.76
Waiting time is not too long in my bank 0.81(fixed)
Queues at the bank move quickly during transactions 0.93(15.31***)

Customer satisfaction 0.92 0.95 0.79

I am satisfied with the services of my bank 0.90(fixed)
This bank meets my expectations 0.91(26.24***)
I will remain with this bank for a long time 0.87(23.27***)
I will patronize other services of my bank 0.85(22.24***)
Overall, I am satisfied with the service quality of the bank 0.90(25.49***)
Effectiveness 0.82 0.84 0.69
My bank has well trained personnel at their disposal 0.842(fixed)
There is consistency in the actions and decisions of my bank's 0.840(7.976***)
personnel.
My bank is effective in carrying out its services 0.872(8.456***)

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 Note: ***p < 0.001; AVE: Average Variance Extracted; CR: Composite Reliability; SD: Standard Deviation;
α: Cronbach alpha

TABLE III: AVES AND DISCRIMINANT VALIDITY

Mean SD 1 2 3 4 5 6 7 8 9 10
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1. Satisfaction 3.55 0.81 0.79

2. Tangibles 3.83 0.80 0.57 0.54

3. Reliability 3.83 0.92 0.63 0.65 0.54

4. Responsiveness 3.50 0.83 0.70 0.66 0.68 0.54

5. Service Portfolio 3.65 0.96 0.45 0.45 0.35 0.41 0.64

6. Assurance 3.89 0.88 0.57 0.56 0.61 0.63 0.40 0.77

7. Price 2.94 0.82 0.68 0.33 0.51 0.47 0.47 0.39 0.55

8. Empathy 3.45 0.97 0.74 0.58 0.73 0.67 0.65 0.67 0.57 0.59

9. Access 3.21 0.99 0.67 0.45 0.57 0.64 0.26 0.49 0.52 0.60 0.76

10. Effectiveness 3.85 0.98 0.53 0.51 0.44 0.51 0.39 0.53 0.65 0.52 0.61 0.69

Note: Diagonal elements are the AVEs; off diagonal elements are the correlations

Table IV: Analysis of Hypothesised Relationships

Path Hypothesis Std. β S.E. t-value p-value Outcome

Tangible—› Satisfaction 1 1.034 .265 6.403 *** Supported
Reliability—›Satisfaction 2 1.681 .236 7.136 *** Supported
Responsiveness—›Satisfaction 3 -.426 .244 -1.747 .081 Not supported
Assurance—›Satisfaction 4 1.408 .163 2.506 .012 Supported
Empathy—›Satisfaction 5 .665 .202 3.288 .001 Supported
Access—›Satisfaction 6 -.006 .104 -.060 .952 Not Supported
Service Portfolio—›Satisfaction 7 -.159 .130 -1.217 .223 Not Supported

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 Price—›Satisfaction 8 1.408 .243 5.791 *** Supported
Effectiveness —›Satisfaction 9 .008 .128 .066 .947 Not supported
Price*Tangible—›Satisfaction 10 .189 .102 1.988 .050 Supported
Price*reliability—›Satisfaction 11 -.832 .151 -5.506 *** Supported
Price*responsiveness—›Satisfaction 12 .526 .154 3.407 *** Supported
Price*service portfolio—›Satisfaction 13 .491 .150 3.027 *** Supported
Price*assurance—›Satisfaction 14 -.189 .100 -1.898 .012 Supported
Price*empathy—›Satisfaction 15 -.409 .111 -3.688 *** Supported
Price*access—›Satisfaction 16 -0.289 1.113 1-.573 *** Supported
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Price*effectiveness—›Satisfaction 17 .018 .082 .222 .824 Not supported

Controls
Gender - 0.019 0.142 0.072 0.971 NS
Age - -0.241 0.169 2.413 0.014 S
Education - 0.253 0.241 3.343 *** S
Occupation - 0.209 0.203 2.016 0.041 S
Ownership of Bank (foreign/local) - -0.084 -.209 -1.132 0.203 NS
Note: ***p < 0.001, ** p < 0.01, *p < 0.05, Std.β = Standardized regression co-efficient; S.E. = Standard error,
p-value = significance, NS= Not Significant, S=Significant

35