Impact of Service Quality Dimensions on Internet Banking Adoption, Satisfaction and Patronage

Document Type: Original Research

Authors

1 Lord Ashcroft International Business School, Anglia Ruskin University, Cambridge, United Kingdom

2 School of Accounting & Business management, FTMS College Malaysia, Kuala Lumpur, Malaysia

3 Research Center for Software Technology and Management (SOFTAM) Faculty of Information Science and Technology, National University of Malaysia (UKM), Malaysia

Abstract

Banking, a demand-driven industry is vastly growing to date by consistently expanding its client network via internet banking. The rendered service quality by banks has nevertheless been the essential tool for attracting prospective customers. Although, impact of service quality on satisfaction and patronage is well researched, investigating the same for internet banking and in Malaysian context is a definite research gap. This study is conducted to see the impact of service quality on the adoption of internet banking and then to identify if the service quality dimensions of reliability, responsiveness, communication, access and security leads to customer satisfaction and subsequently leads to patronage in Malaysia. The data is gathered from 202 bank customers using judgmental sampling through two sets of questionnaires viz. User of Internet Banking and Non-User of Internet Banking. Based on the determined results produced using SPSS 20 indications were obtained that the customers place great emphasis towards the service quality dimension of security and accessibility of internet banking respectively. The service quality has been found to significantly influence the adoption of internet banking in Malaysia. Service quality aspects, specially access and security, impact satisfaction and satisfaction impacts patronage, therefore, in accelerating the adoption rate, the banks should further enhance their offering in internet banking and concurrently provide a more efficient and easy to user interface.

Keywords


Acharya, V. V., Khandwala, H., & Sabri Öncü, T. (2013). The growth of a shadow banking system in emerging markets: Evidence from India. Journal of International Money and Finance. https://doi.org/10.1016/j.jimonfin.2013.06.024
Alsajjan, B., & Dennis, C. (2006). The Impact of Trust on Acceptance of Online Banking. European Association of Education and Research in Commercial Distribution.
Alsudairi, M. A. T. (2012). E-service quality strategy: Achieving customer satisfaction in online banking. Journal of Theoretical and Applied Information Technology.
Altman, D. (1996). How do I analyse observer variation studies? Distribution.
Andreassen, T. W., & Lindestad, B. (1998). The effects of corporate image in the formation of customer loyalty. Journal of Service Marketing.
Angur, M. G., Nataraajan, R., & Jahera, J. S. (1999). Service quality in the banking industry: An assessment in a developing economy. International Journal of Bank Marketing. https://doi.org/10.1108/02652329910269211
Areepattamannil, S., & Khine, M. S. (2017). Early adolescents’ use of information and communication technologies (ICTs) for social communication in 20 countriesExamining the roles of ICT-related behavioral and motivational characteristics. Computers in Human Behavior. https://doi.org/10.1016/j.chb.2017 .03.058
Babakus, E., & Boller, G. W. (1992). An empirical assessment of the SERVQUAL scale. Journal of Business Research. https://doi.org/10.1016/0148-2963(92)90022-4
Bahia, K., & Nantel, J. (2000). A reliable and valid measurement scale for the perceived service quality of banks. International Journal of Bank Marketing. https://doi.org/10.1108/02652320010322994
Baker, J., Grewal, D., & Parasuraman, A. (1994). The influence of store environment on quality inferences and store image. Journal of the Academy of Marketing Science: Official Publication of the Academy of Marketing Science. https://doi.org/10.1177/ 0092070394224002
Baumann, C., Elliott, G., & Hamin, H. (2011). Modelling customer loyalty in financial services. International Journal of Bank Marketing. https://doi.org/10.1108/0265 2321111117511
Bradley, L., & Stewart, K. (2002). A Delphi study of the drivers and inhibitors of Internet banking. International Journal of Bank Marketing. https://doi.org/10.1108/0265 2320210446715
Carman, J. (1990). onsumer perceptions of service quality: an assessment of the SERVQUAL dimensions. Journal of Retailing. https://doi.org/10.1016/S0148-2963(99)00084-3
Caruana, A. (2002). Service loyalty: The Effect of Service Quality and the Mediating Role of Customer Satisfaction. European Journal of Marketing. https://doi.org/10.1108/03090560210430818
Chan, L. K. C., Lakonishok, J., & Sougiannis, T. (2001). The stock market valuation of research and development expenditures. Journal of Finance. https://doi.org/10.11 11/0022-1082.00411
Guo, X., Duff, A., & Hair, M. (2008). Service quality measurement in the Chinese corporate banking market. International Journal of Bank Marketing. https://doi.org/10.1108/02652320810894389
Gupta, S., & Zeithaml, V. (2006). Customer Metrics and Their Impact on Financial Performance. Marketing Science. https://doi.org/10.1287/mksc.1060.0221
Hanaysha, J., Abdullah, H., & Warokka, A. (2011). Service Quality and Students’ Satisfaction at Higher Learning Institutions: The Competing Dimensions of Malaysian Universities’ Competitiveness. The Journal of Southeast Asian Research. https://doi.org/10.5171/2011.855931
Heskett, J. L., Sasser, W. E., & Hart, C. W. L. (1990). Service Breakthroughs. Free Press.
Høst, V., & Knie-Andersen, M. (2004). Modeling customer satisfaction in mortgage credit companies. International Journal of Bank Marketing. https://doi.org/10.1108 /02652320410514915
Hsu, M. H., Yen, C. H., Chiu, C. M., & Chang, C. M. (2006). A longitudinal investigation of continued online shopping behavior: An extension of the theory of planned behavior. International Journal of Human Computer Studies. https://doi.org/10. 1016/j.ijhcs.2006.04.004
Jiang, L. A., Yang, Z., & Jun, M. (2013). Measuring consumer perceptions of online shopping convenience. Journal of Service Management, 24(2), 191–214. https:// doi.org/10.1108/09564231311323962
Johnson, S. E., & Hall, A. (2005). The prediction of safe lifting behavior: An application of the theory of planned behavior. Journal of Safety Research. https://doi.org/ 10.1016/j.jsr.2004.12.004
Jun, M., & Cai, S. (2001). The key determinants of Internet banking service quality: A content analysis. International Journal of Bank Marketing. https://doi.org/10.1108/ 02652320110409825
Kassim, N., & Asiah Abdullah,  nor. (2010). The effect of perceived service quality dimensions on customer satisfaction, trust, and loyalty in e-commerce settings: A cross cultural analysis. Asia Pacific Journal of Marketing and Logistics. https://doi.org/10.1108/13555851011062269
Kesharwani, A., & Bisht, S. S. (2012). The impact of trust and perceived risk on internet banking adoption in India: An extension of technology acceptance model. International Journal of Bank Marketing. https://doi.org/10.1108/0265232121123 6923
Kumari, V., & Rani, S. (2012). Customer Perception of Services Quality in The Retail Banking. European Journal of Business and Management.
Ladhari, R. (2009). A review of twenty years of SERVQUAL research. International Journal of Quality and Service Sciences. https://doi.org/10.1108/1756669091097 1445
Laukkanen, T., & Pasanen, M. (2008). Mobile banking innovators and early adopters: How they differ from other online users? Journal of Financial Services Marketing. https://doi.org/10.1057/palgrave.fsm.4760077
Lee, E. J., Kwon, K. N., & Schumann, D. W. (2005). Segmenting the non-adopter category in the diffusion of internet banking. International Journal of Bank Marketing. https://doi.org/10.1108/02652320510612483
Lewis, R. C., & Booms, B. H. (1983). The Marketing Aspects of Service Quality, in Emerging Perspectives on Services Marketing. Emerging Perspectives on Services Marketing, L, Berry, G, Shostack and G. Upah. https://doi.org/10.1002/anie.20100 1518
Light, J. (1997). `Communication is the essence of human life’: Reflections on communicative competence. AAC: Augmentative and Alternative Communication. https://doi.org/10.1080/07434619712331277848
Newman, K. (2001). Interrogating SERVQUAL: A critical assessment of service quality measurement in a high street retail bank. International Journal of Bank Marketing. https://doi.org/10.1108/02652320110388559
Niklas, S., Boehm, S., & Strohmeier, S. (2011). Faulty Results by Neglecting Mobile Service Usage Context. In Proceedings of the 10th European Conference on Research Methodology for Business and Management Studies.
Oliver, R. (2006). CUSTOMER SATISFACTION RESEARCH. In The handbook of marketing research. https://doi.org/10.4135/9781412973380
Olsen, L. L., & Johnson, M. D. (2003). Service Equity, Satisfaction, and Loyalty: From Transaction-Specific to Cumulative Evaluations. Journal of Service Research. https://doi.org/10.1177/1094670502238914
Parasuraman, A., Zeithaml, V., Berry, L. (1988). SERVQUAL: A Multiple-Item Scale for Measuring Consumer Perceptions of Service Quality. Jorunal of Retailing. https://doi.org/10.1016/S0148-2963(99)00084-3
Parasuraman, A., Zeithaml, V. A., & Berry, L. L. (1985). A Conceptual Model of Service Quality and Its Implications for Future Research. Journal of Marketing. https://doi.org/10.2307/1251430
Parasuraman, A., Zeithaml, V. A., & Malhotra, A. (2005). E-S-QUAL a multiple-item scale for assessing electronic service quality. Journal of Service Research. https://doi.org/10.1177/1094670504271156
Patsiotis, A. G., Hughes, T., & Webber, D. J. (2012). Adopters and non-adopters of internet banking: A segmentation study. International Journal of Bank Marketing. https://doi.org/10.1109/SIEDS.2018.8374759
Ram Mohan, A., Krishnaraj, R., Harindranath, R. M., & Vijayaragavan, M. (2014). Dimensions and determinants of apparel retail store patronage in India. Journal of the Textile Association.
Reichheld, F. F. (1993). Loyalty-based management. Harvard Business Review. https://doi.org/10124634
Sadiq Sohail, M., & Shanmugham, B. (2003). E-banking and customer preferences in Malaysia: An empirical investigation. In Information Sciences. https://doi.org/10.1 016/S0020-0255(02)00378-X
Sathye, M. (2002). Measuring productivity changes in australian banking: An application of malmquist indices. Managerial Finance. https://doi.org/10.1108/030743502107 68068
Shaikh, A. A., Karjaluoto, H., & Chinje, N. B. (2015). Consumers’ perceptions of mobile banking continuous usage in Finland and South Africa. International Journal of Electronic Finance, 8(2–4), 149–168. https://doi.org/10.1504/IJEF.2015.070528
Simpson, J. (2002). The impact of the Internet in banking: Observations and evidence from developed and emerging markets. Telematics and Informatics. https://doi.org/10.1016/S0736-5853(01)00019-3
Stauss, B., Heinonen, K., Strandvik, T., Mickelsson, K.-J., Edvardsson, B., Sundström, E., & Gummerus, Christian Gronroos, J. (2010). Managing Service Quality. Journal of Service Management. https://doi.org/10.1108/09604520210421383
Storbacka, K., Strandvik, T., & Gronroos, C. (1994). Managing Customer Relationships for Profit: The Dynamics of Relationship Quality. International Journal of Service Industry Management. https://doi.org/10.1108/09564239410074358
Sukkar, A. Al, & Hasan, H. (2005). Toward a model for the acceptance of Internet banking in developing countries. Information Technology for Development. https://doi.org/10.1002/itdj.20026
Szmigin, I., & Foxall, G. (1998). Three forms of innovation resistance: The case of retail payment methods. Technovation. https://doi.org/10.1016/S0166-4972(98)00030-3
Voss, G. B., Parasuraman, A., & Grewal, D. (1998). The Roles of Price, Performance, and Expectations in Determining Satisfaction in Service Exchanges. Journal of Marketing. https://doi.org/10.2307/1252286
Wang, Y., Lo, H. P., & Hui, Y. V. (2003). The antecedents of service quality and product quality and their influences on bank reputation: Evidence from the banking industry in China. Managing Service Quality: An International Journal. https://doi.org/10. 1108/09604520310456726
Yang, Y. J. (2006). The Security of Electronic Banking. In Proceedings of the 20th National Information Systems Security Conference.
Zeithaml, V. A., Berry, L. L., & Parasuraman, A. (1996). The Behavioral Consequences of Service Quality. Journal of Marketing. https://doi.org/10.2307/1251929