Mobile Banking Service Quality, Customer Perceived Value and Customer Retention in the Kenyan Banking Industry
Keywords:
Mobile Banking Service Quality, Customer Perceived Value, Customer Retention, Kenyan Banking IndustryAbstract
Customer retention is increasingly becoming an important managerial issue, especially in this era which is characterized by high levels of competition and assertive customers who make stay or switch decisions guided by their rational and emotional influences. Moreover, customers are increasingly becoming quality conscious and value driven. To date, there is limited evidence of studies that investigated the effects of mobile banking service quality, customer perceived value and customer retention constructs in a single framework, hence, the study seeks to fill the gap. This study examines the effect of mobile banking service quality, customer perceived value on customer retention. Additionally, the study examines the mediating effect of customer perceived value on the relationship between mobile banking service quality and customer retention. The study was guided by the ‘leaky bucket theory’ of marketing and the MS-QUAL model. An explanatory research design was adopted, employing multistage, simple random and systematic sampling techniques in collecting data from a sample size of 400 university staff drawn from two public and two private universities based in Nairobi City County who are consumers of mobile banking services. A self-administered questionnaire was used. Hierarchical and multiple regression models using Hayes Process macro were used to analyze data obtained and to test the hypotheses. The study found that: mobile banking service quality (β= 0.565, p = 0. 000), perceived customer value (β= 0.363, p = 0.000), significantly affect customer retention. Additionally, the results show that customer perceived value mediates the relationship between mobile banking service quality and customer retention (β =. 193, CI = .127, .266). This study concludes that, customers will remain committed to patronize a bank whose services are deemed of high quality and with a high value. The study contributes to knowledge by revealing customer perceived value mediates the relationship between mobile banking service quality and customer retention. Bank management and policy makers should; develop quality assurance policies and devise value-centered strategies that focus on customer perceived value in order to enhance customer retention rates.
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