Effects of Service Quality on Customer Satisfaction At Bank of Abyssinia, Ethiopia

The main objective of this study was to evaluate the effect of service quality on customer satisfaction at Bank of Abyssinia (BOA) in Addis Ababa. To achieve this objective, descriptive and explanatory research design were used to analyze the data collected through questionnaire from a sample of 342 customers these respondents were selected using randomly sampling method. The data collected through a questionnaire were analyzed using statistical tools such as mean, standard deviation, correlation and regression analysis. The major finding of the study indicates that, the customers were highly satisfied with assurance, responsiveness, reliability, empathy and tangibility of service quality dimensions. On the other hand, the correlation result shows that there is positive and significant relationship between service quality dimensions and customer satisfaction. The results also indicate that unlike responsiveness and empathy the three service quality dimensions (tangibility, assurance and reliability) have strongly positive and significant effect (58.1%) on customer satisfaction. Based on the findings of the study, the researchers recommend BOA to make best use of new communication channels such as the internet banking, and mobile banking by developing effective and punctual core banking system. The bank should pay special attention for empathy of service quality dimension by enhancing employees’ commitment in offering quality services in a way the customers feel more valued, friendly and treated individually.