Internal factors affecting customer satisfaction of commercial banks in Kitui town

Abstract

The purpose of this study was to establish internal factors affecting customer satisfaction of commercial banks in Kitui town, Kitui County. This was achieved by analyzing the following five specific objectives: T o determine the effect of commercial banks’ product innovation on customer satisfaction in Kitui town. Secondly, to examine the effect of commercial banks’ relationship management on customer satisfaction in Kitui town. Thirdly, is to find out the impact of commercial banks’ customer feedback on customer satisfaction in Kitui t own. Fourthly, is to determine the effect of commercial banks’ turnaround time on customer satisfaction in Kitui town and to find out the effect of commercial banks’ queuing management system on customer satisfaction in Kitui town. The study targeted an estimated population consisting 560 active customers, from NBK, 570 active customers, from KCB, 580 active customers, from Equity, 490 active customers, from BBK, 430 active customers, from Cooperative, 270 active customers, from Family, 220 active customers , from Postbank, and about 160 active customers i n K - rep Bank. The banks were stratified into eight strata, and simple random sampling was used to pick the respondents from the eight branches of different banks operating in Kitui town. The study adopted descriptive survey design. The design supports the development of precise measurements and reporting of characteristics of some population phenomena. Two instruments were developed for the study. There was a questionnaire for both bank customers and an interview schedule for the bank managers in the eight commercial banks. The questionnaire for customers was administered at the entrance . The branch managers were interviewed on product uptake and customer retention using the interview schedule. This information was used in determining the customer s’ satisfaction with bank products. Quantitative data from the study was analyzed using SPSS Version 21, and different statistics was measured and analyzed. Qualitative data was analyzed by a particular discussion of a rising themes and observations made. Finally, triangulation on the data was performed to check out the consistency of the findings generated by the different methods used. Responses to similar themes or objectives, emanating from different respondents were compared to determine their convergence or divergence. The findings of this study were; this study shows that a unit change in turnaround time will cause a positive change in customer satisfaction and that turnaround time has the greatest contribution to the model. Also unit changes in customers queuing management will lead to a significant change in customer satisfaction. A unit change in product relationship management will lead to a change in customer satisfaction significantly. Also unit change in customer’s feedback will result to a positive change in customer satisfaction while a unit change in product innovation will course a positive change in customer satisfaction. The adjusted R squared shows that the variations in customers’ satisfaction are significantly explained by the independent variables (product innovation, relationship management, customers’ feedback, turnaround time, and queuing management). Based on the findings of this study, the researcher made the following recommendations; - The bank should frequently carry out customer satisfaction surveys to find out the opinions of its customers. Their feedback can be used to improve services and products offered. The bank should also improve its turnaround time as this will help shorten queues and waiting time of customers. The bank should shorten the time that it takes to make decisions on customer requests.