ANALYSIS OF FACTORS AFFECTING CUSTOMERS’ SELECTION OF BANK SERVICES (A Case Study of Worabe Town, Ethiopia)

Abstract

Globally, competition in the banking industry has become fierce, and banks are adopting various marketing strategies to determine the consumer and his perception of their offerings. The purpose of this study is to analyze the major factors of a bank selection by a customer and how customers rank the factors based on their importance level to patronize in banking services of worabe town, Ethiopia. A descriptive, cross-sectional survey was conducted among 395 convenience selected bank customers used to identify the predictors of bank choice from different occupation in the analysis. The Data required for this study collected from two sources; these are primary and secondary sources. A convenience sampling was used. The data was then coded, cleaned, analyzed and interpreted with the help of Statistical Package for Social Scientists (SPSS) where factor analysis and was used to analyze the data. Chi-square test was used to examine the association between different variables. The finding from this study reveal that group effect, role and status and family effect have significant effect on customers’ bank selection but, culture have insignificant association with customer bank preference as well as the five service quality dimension have significant effect on customer bank selection. The finding also reveals that most five important bank selection criteria for customers are good customer service, security arrangement of the bank, ATM facility, Offered variety service and internet banking. On the other hand, the least three important factors of bank selection for customers are low service charge, parking service and low interest rate on loan.