Analyzing Customer Satisfaction by Using Servqual Model of Five-Dimension

Analyzing Customer Satisfaction by Using Servqual Model of Five-Dimension

Analyzing Customer Satisfaction by Using Servqual Model of Five-Dimension; Focus on E-Banking Service Quality of the Dhaka Bank Limited

History of Dhaka Bank Ltd

The nation was just halfway of its age the passion for history and heritage and an obsession for faster pace exerted a powerful force for change in the business world. Many budding hopes grew as a choice of the new generation in the shadows of banking reformation of the nineties. Dhaka Bank is such a dream that spread in profusion modern banking prospects with deep attachment to its community and culture. A host of visionary entrepreneur friends inspired by a futurist leader set forth the fight of this great corporate voyage that echoed the speed of technology on the inner soul of Bangladesh. Dhaka Bank was incorporated as a Public Limited Company on April 6, 1995 under Companies Act, 1994. The company commenced banking operations on July 5, 1995.

From the very year of its landmark journey, Dhaka Bank has truly cherished and brought into focus the heritage and history of Dhaka and Bangladesh from Mughal outpost to modern metropolis. Most of its presentation, publications, brand initiatives, delivery channels, calendars and financial manifestations bear Bank’s commitment to this attachment. The Bank is widely recognized today for its exceptional service, simplicity, proximity and cutting-edge way of delivery.

The Bank has stood out for its financial strength and operational craftsmanship marking its position as the potential market player in all core areas of banking in the country. It got listed in DSE and CSE in 2000. Alongside a lasting bond with the corporate world, DBL has got hold of a countrywide reach through a larger network of Branches, ATMs, SME channels, agricultural outreach and mobile banking. DBL has made its vibrant presence at 89 locations including 2 Islamic Banking Branches, 1 Offshore Banking Unit, 3 SME Service Centers, 1 Business Kiosk and 46 ATMs across the country. Catering to the needs of Capital Markets, the Bank has established a subsidiary company named ‘DBL Securities Ltd.’ having 6 countrywide Branches.

The Bank expects to rise from the heart of Bangladesh as a stronger force in the market they serve. They are committed to our goals to create superior shareholder value in their quest for excellence as they grow and mature into a banking veteran.

Mission Statement of Dhaka Bank Ltd

  • To be the premier financial institution in the country
  • providing high quality products and services backed by latest technology
  • Highly motivated personnel to deliver Excellence in Banking.

Vision Statement of Dhaka Bank Ltd

  • To assure a standard that makes every banking transaction a pleasurable experience.
  • To offer a supreme service through accuracy, reliability, timely delivery, cutting edge technology and tailored solution for business needs
  • Global reach in trade and commerce and high yield on their investments.
  • Their people, products and processes are aligned to meet the demand of their discerning

Objectives of Dhaka Bank Ltd

The goal of Dhaka Bank is to achieve a distinct foresight. Their prime objective is to deliver a quality that demonstrates a true reflection of our vision- Excellence in Banking. Other objectives are:-

  • To facilitate its stakeholders with high standard and quality banking.
  • To conduct foreign exchange business such as international money remittance service.
  • To extent credit facility to the client.
  • To provide standard and quick services in to the client.
  • To extent custodial services such as locker.
  • To extent general banking services to the clients.
  • Buying and selling foreign currencies.

Functions of Dhaka Bank Ltd

  • The main task of DBL is to accept deposits from various customers through various
  • Provides loans on easy terms and conditions.
  • Creates loan depos
  • Invests its fund into profitable sectors.
  • Transfers money by Demand Draft (DD), Pay Order (PO) and Telegraphic Transfer, etc.
  • Does transaction of bill of exchange, cheque, etc. on behalf of the clients.
  • DBL assists in the foreign exchange by issuing leer of credit.
  • Insures the securities o valuable documents of clients.
  • Brings the increasing power of dimension of transaction.

Above all Dhaka bank Ltd helps the businessmen by giving them discount facilities for bills of Exchange and by providing the facility of Letter of Guarantee.

Banking Category of Dhaka Bank Ltd

Basically Dhaka Bank Ltd doing their business in three categories:-

Corporate Banking:-They are committed to helping their clients achieve their ambitions. Over the years they have developed the unique perspective & broad capabilities to deepen client relationships and to help them come out on top.

Consumer Banking:-They are one of the pioneering banks in Consumer Banking sector amongst local and multinational financial institutions. They have a focus on customer segment through proper channeling to ensure quality asset/liability, product innovation and brand building.

SME Banking:- As a commercial bank, Dhaka Bank has made best possible efforts to contribute to the development of SME sector through its countrywide network. The Bank has formally stepped into financing SMEs in the country in 2003.

Strategic Objectives of Dhaka Bank Ltd

  • The objectives of DBL is to conduct transparent and high quality business operation based on market mechanism within the legal and social framework spelt in its mission and reflected in its vision.
  • The greatest concerns are customers to provide them continually efficient, innovative and high quality products with excellent delivery system.
  • The motto is to generate profit with qualitative business as a sustainable ever growing Organization and enhance fair returns to shareholders.
  • They have committed to community as a corporate citizen and contributing towards the progress of the nation as corporate social responsibility.
  • They Promote employees wellbeing through attractive compensation package, promoting staff morale through training, development and career planning.
  • They have Strive for fulfillment of responsibility to the government through paying entire range of taxes and duties and abiding the other rules.
  • They Cautious about environment & climatic change and dutiful to make homeland a green and clean soil.

Research Part –

In Bangladesh, customers in the E-banking sector have a strong bargaining position due to the significant growth of E-Banking service. Therefore, banks have to provide service carefully because of the availability of banks. Service quality has been a vital issue of discussion and research over the past three decades. Research on E-banking service quality has well established that the customer perception of the quality of a service depends on customer’s pre-service expectations. Studies by Parasuraman et al. (1985), Zeithmal et al. (1990), noted that the key strategy for the success and survival of any business institution is the deliverance of quality services to customers. Accordingly, Chang (2008) deemed that excellent service quality is vital to business success and survival. Hence, delivering quality service to clients is a necessity for success and survival in today’s competitive world (Kheng et al., 2010).

Now bank service depends on the customers for their survival in the market. The customer is the focus and customer service is the differentiating factors (Guo et al., 2008). Those service providers who establish a high level of service quality retain a high level of customer satisfaction; they also need to obtain a sustainable competitive advantage. Bank should be known about the expectation and perception of the customer. Measuring customer’s expectation is the key to being able to serve the customer satisfactorily. Internet banking can be seen as a truly global phenomenon that has made time and distance irrelevant to many transactions.

Banks do business with customer’s money. So they need to satisfy their customers because of involving their Bank’s for more secure business and profitability. If a bank cannot provide proper customer service, then the bank would be losing its customers. The profitability would also be decreasing because of the poor customer service. According to Kang (2004) many service delivery errors and problems can occur and that is not beneficial for the reputation of the organization. In order to achieve customer satisfaction, organizations must be able to build and maintain long lasting relationships with customers through satisfying various customers’ needs and demands Otherwise the Bank will get negative word-of-mouth, switching and reduced consumption will affect the productivity and profitability of the bank.

On that research it will show the service quality of Dhaka Bank local office that are treading both locally and globally and the level of customer satisfaction of the Dhaka Bank Ltd.

The nature of this research is descriptive and much of the data collected are from the secondary sources. Primary data are also collected through personal interview method conducting the persons who are supposed to have knowledge about the problem.

Purpose of the study

The purpose of this study is to investigate the Customer Service Quality which always affects Customer Satisfaction. It will help to look into the causes of the problems that Dhaka Bank Ltd is facing. So I have to find out how Customer Satisfaction is affected by various service qualities such as Reliability, Responsiveness, Empathy, Assurance and Tangibles. In a competitive marketplace it’s become very difficult to satisfy customer by giving services. On the other hand businesses competitor are rising day by day for giving various facilities for customer satisfaction. Basically it becomes the key element of business strategy.

For establishing good business network Customers liking is necessary for the Banking sector. For surviving in the competitive field of the banking sector Dhaka Bank Ltd need to find out better service opportunities to provide their customer.

Research Objective

The research objectives of this study are:-

  • To analyze the customer satisfaction level by using E-Banking service quality in the private commercial Dhaka Banks Ltd of Bangladesh in terms of five service dimensions: Reliability, Responsiveness, Assurance, Empathy and Tangibles.
  • To put forward some possible recommendation to improve E-Banking service quality for customer satisfaction.

Literature Review –

Electronic Banking:

Electronic banking is a segment of electronic business, which turns into all types of business performed through electronic networks. Electronic distribution channels provide alternatives for faster delivery of banking services to a wider range of customers (Kaleem and Ahmad, 2008).

Electronic channels are used for both business-to-business and business-to-customer transactions, such as ordering goods, delivering software or paying for such transactions.

E-banking is considered to be a segment of e-business to the extent that banks are involved in the conduct of business transactions via electronic media; other non-banking financial products and services not to mention products and services from other sectors of business, may be sold electronically as well In other words, e-banking is not a banking product rather it describes the way transactions are conducted. Establishing E-banking infrastructure has been a challenging task for the developing countries like Bangladesh.

E-banking can also be defined as a variety of the following platforms:-

PC- Banking:

Basically it used for business transacted from a customer’s PC by Using PC banking or home banking using password. There are two types of PC banking.

  • Online Banking: transactions are conducted within closed networks. The customer needs specialized software provided by his bank.
  • Internet Banking: only product are offering at the time was information? Unlike closed networks, Internet banking permits the customer to conduct transactions from any terminal with access to the Internet.

Internet Banking:

Basically it’s a software based banking service which existed on internet when it loaded on computer. Actually it’s carry on with online banking transactions. Which provide financial service is characterized by individuality, independence of time and place and flexibility by using public network.

Mobile Banking:

Mobile banking is the new transmission technologies such as WAP (Wireless Application Protocol), portable terminal like mobile phones, personal digital assistant (PDA) or small handheld PCs are providing bank customers with access to the Internet and thus paving the way to Internet banking.

Other forms of M-Banking:

  • Any branch banking/ anywhere banking.
  • SMS banking.
  • Electronic fund transfer system.
  • Card-Debit/ ATM card and credit card.
  • Virtual banking.


Tele-banking service is provided by phone. To access an account it is required to dial a Particular telephone number and there are several options of services. Options included

  • Checking account balance
  • Funds transfer between current, savings and credit card accounts
  • Bill payments
  • Stock exchange transaction
  • Receive statement via fax
  • Loan payment information

Customer Services Quality in Banking Sector

Customer service quality is changing day by day in banking sector because of new growing technology. Now a day’s Bank have to be provide world-class standard, committed to excellence in customer’s satisfaction and to play a major role in the growing and diversifying financial sector. Now a day’s customers have demanded globally quality services from banks with various choices. Banks have recognized the needs of customer’s.

Consequently service quality is a critical motivating force to drive the bank up in the high technology ladder. Banking industry is a demand driven industry, which constitute an important part of the service industry (Newman & Cowling, 1996). Banks have to update their corporate image for emphasizing service quality since it provides many advantages to a company such as allowing the company to differentiate itself from its competitors by increasing sales and market shares, providing opportunities for cross selling, improving customer relations thus enhancing the corporate image, reliability, responsiveness, credibility and communication results in the satisfaction and retention of customers and employee, thus reducing turnover rate (Newman, 2001).For increasing customer Bank need to improve their service quality for buildup strong image in Banking sector of Bangladesh.

Service Quality

Service quality is considered an important tool for a firm’s struggle to differentiate itself from its competitors. Service quality has received a great deal of attention from both academicians and practitioners and service marketing literature defined service quality as the overall assessment of a service by the customer. Duff et al.(2008) pointed out that, by defining service quality, companies will be able to deliver services with higher quality level presumably resulting in increased customer satisfaction. Akroush (2008) also pointed out that service quality is the result of the comparison made by customers about what they feel service firms should offer, and perceptions of the performance of firms providing the services. Gronroos (2007) also defined service quality as the outcome of the comparison that consumers make between their expectations and perceptions. Customer’s expectation serves as a foundation for evaluating service quality because, quality is high when performance exceeds expectation and quality is low when performance does not meet their expectation (Athanassopouloset al., 2001). Perceived service is the outcome of the consumer’s view of the service dimensions, which are both technical and functional in nature. It is very vital to note here that, service quality is not only assessed as the end results but also on how it is delivered during service process and its ultimate effect on consumer’s perceptions (Duncan & Elliot, 2004). Service quality has a strong correlation with customer satisfaction, financial performance, manufacturing costs, customer retention, customer loyalty, and the success of marketing strategy (Cronin et al., 2000; Wong et al., 2008). Organizations operating within the service sector consider service quality to be a strategic component of their marketing plan (Spathisetal., 2004). Through service quality, organizations can reach a higher level of service quality, a higher level of customer satisfaction, and can maintain a constant competitive advantage (Meuteret al., 2000).

Online Banking Service

A study by (Picado, Gonzalez &Eckelman 2004) investigated customer satisfaction in the service industries using quality function deployment (QFD). They considered both external and internal service management issues and subsequent service innovations based on the framework of QFD. The study also includes benefits and disadvantages of the QFD process as compared to service quality and customer paradigms, in addition to recommendations for future applications, with particular interest in the online banking service management issues. Various research studies on consumer attitude and adoption of internet banking have shown that there are several factors influencing the consumer’s attitude towards online banking such as person’s demography, motivation and behavior towards different banking technologies and individual acceptance of new technology. It has been found that consumer’s attitudes toward online banking are influenced by the prior experience of computer and new technology (Laforet and Li 2005).

As far as online banking adoption is concerned, security, trust and privacy concerns have been outlined as extremely important ones from the consumer’s standpoint (Benamati and Serva2007).

Online banking requires perhaps the most consumer involvement, as it requires the consumer tomaintain and regularly interacts with additional technology (a computer and an Internet connection) (Jane et al, 2004). Consumers who use e-banking use it on an ongoing basis and need to acquire a certain comfort level with the technology to keep using it (Servon, and Kaestner 2008).

The service quality attributes that banks must offer to encourage consumers to switch to online banking are perceived usefulness, ease of use, reliability, security, and continuous improvement (Liao and Cheung 2008). In another study (2002), they also found that individual expectations regarding accuracy, security, user involvement and convenience were the most important quality attributes in the perceived usefulness of Internet based e-retail banking.

Customer Satisfaction in Banking Sector

In line with Tsoukatos and Rand (2006), customer satisfaction is a key to long-term business success. To protect or gain market shares, organizations need to outperform competitors by offering high quality product or service to ensure satisfaction of customers. In proportion to Magesh (2010), satisfaction means a feeling of pleasure because one has something or has achieved something. It is an action of fulfilling a need, desire, demand or expectation.

Customers compare their expectations about a specific product or services and its actual benefits. As stated by Kotler& Armstrong, (2010), satisfaction as a person’s feelings of pleasure or disappointment resulting from the comparison of product’s perceived performance in reference to expectations.

Customer’s feelings and beliefs also affect their satisfaction level. Along with Zeithaml (2009) If the customers of an organization are satisfied by their services the result is that, they will be loyal to them and consequently be retained by the organization, which is positive for the organization because it could also mean higher profits, higher market share, and increasing customer base (Karatepeet al., 2005). Customer satisfaction has become important due to increased competition as it is considered very important factor in the determination of bank’s competitiveness (Berry et al., 2002). Continuous measurement of satisfaction level is necessary in a systematic manner (Chakravartyet al., 1996). Because satisfied customer is the real asset for an organization that ensures long-term profitability even in the era of great competition. Cronin et al., (2000) mentioned in their study that satisfied customer repeat his/her experience to buy the products and also create new customers by communication of positive message about it to others.

On the other hand, dissatisfied customer may switch to alternative products/services and communicate negative message to others. Customer satisfaction is a set of feeling or outcome attached with customer’s experience towards any product/ service (Solomon, 1998). Hence, organizations must ensure the customer satisfaction regarding their goods/services.

Relationship between Service Quality and Customer Satisfaction

Quality and customer satisfaction have long been recognized as playing a crucial role for success and survival in today’s competitive market. Regarding the relationship between customer satisfaction and service quality, Oliver (1993) first suggested that service quality would be antecedent to customer satisfaction regardless of whether these constructs were cumulative or transaction-specific. In relating customer satisfaction and service quality, researchers have been more precise about the meaning and measurements of satisfaction and service quality.

Satisfaction and service quality have certain things in common, but satisfaction generally is a broader concept, whereas service quality focuses specifically on dimensions of service (Wilson et al.,2008). Although it is stated that other factors such as price and product quality can affect customer satisfaction, perceived service quality is a component of customer satisfaction (Zeithaml&Bitner, 2003). As said by Wilson et al. (2008), service quality is a focused evaluation that reflects the customer’s perception of reliability, assurance, responsiveness, empathy and tangibility while satisfaction is more inclusive and it is influenced by perceptions of service quality, product price and quality, also situational factors and personal factors. The relationship between service quality and customer satisfaction is becoming crucial with the increased level of awareness among bank customers Demographic characteristics should be considered by the bank managers to understand their customers (Sureshchanderet al.2002).

Service Quality Dimensions (SERVQUAL)

In the banking sector higher service quality is related with higher customer satisfaction. There are no recognized standard scales to measure the perceived quality of a bank service. Service quality dimensions are the only way to analyze the service quality of the organization and easy way to find out the expectation of the customer’s. One of the important issues related to service quality and the dimensions of service quality and the measurement tools of Parasuraman et al. (1988) SERVQUAL model.

  • Reliability: Reliability depends on handling customers’ services problems and performing services right the first time and provide services at the promised time and maintaining error-free record. Reliability also consists of accurate order fulfillment, accurate record, accurate quote, accurate in billing, accurate calculation of commissions, keep services promise.
  • Responsiveness: Responsiveness involves timeliness of service like posting a transaction slip immediately, returning a phone call quickly, giving prompt service, and setting up appointments quickly. Responsiveness also refers to the motivation to help (internal) customers and provide prompt service to them. It is defined as the willingness to help customers an provide prompt service (Parasuraman et al., 1988). It is also involves understanding needs and wants of the customers, convenient operating hours, individual attention given by the staff, attention to problems and customers‟ safety in their transaction.
  • Assurance: Parasuraman et al. (1985) defined assurance as knowledge and courtesy of employees and their ability to inspire trust and confidence. According to Sadek et al. (2010), in British banks assurance means the polite and friendly staff, provision of financial advice, interior comfort, eases of access to account information and knowledgeable and experienced management team
  • Empathy: Parasuraman et al. (1985) defined empathy as the caring and individual attention the firm provides its customers. It involves giving customers individual attention and employees who understand the needs of their customers and convenience business hours. Empathy also give individual attention; convenient operating hours, giving personal attention, best interest in heart and understand customer’s specific needs.
  • Tangibles: Tangibles are the physical facilities, equipment, and appearance of personnel in services (Parasuraman et al., 1988). It includes all the physical evidence of the service like the facilities, appearance of personnel, tools or equipment used to provide the service, physical representations of the services and even other customers.

Research Questions

  1. Does Reliability provide better service for increasing customer Satisfaction?
  2. Does Responsiveness provide quick and efficient service for increasing customer Satisfaction?
  3. Does Assurance provide good relationship with employees that improve customer Satisfaction?
  4. Does Empathy affects customer need which increases service quality for customer satisfaction?
  5. Does Tangibles provide modern services to improve service quality for customer Satisfaction?

Research Hypothesis

  • Reliability provide better service for increasing customer Satisfaction
  • Responsiveness provide quick and efficient service for increasing customer Satisfaction
  • Assurance provide good relationship with employees that improve customer Satisfaction
  • Empathy affects customer needs which increases service quality for customer satisfaction
  • Tangibles provide modern services to improve service quality for customer Satisfaction


Research Design

This study has compared the customer perceptions of service quality of Dhaka Bank Ltd with the other private Banks such as Prime Bank Ltd and Bank Asia Ltd under five key dimensions like reliability, responsiveness, assurance, empathy, and tangibles. This shows the satisfaction level of customer at Dhaka Bank Ltd. Here Service Quality is the independent variables which contain Reliability, Responsiveness, Assurance, Empathy, Tangible and the dependent variable is the Customer satisfaction.

Sampling Method

In this study sampling will be selected for the research because of accessing the sampling frame of Dhaka Bank Ltd in Bangladesh. Basically it’s sampling the corporate clients who are using the E-Banking services of Dhaka Bank Ltd. The main objective of the research is to investigate the customer satisfaction level of E-Banking Service Quality by using “Parasuraman, Zeithaml, and Berry (1988)” five dimensions in service in context of Dhaka Bank Ltd in Bangladesh.


Data Collection

This research is based on both primary and secondary sources of Information. Questionnaires will be distributed among 48 local corporate customers who using E-Banking services of Dhaka Bank Ltd, Prime Bank Ltd and Bank Asia Ltd to collect data.

  • Primary Data: Primary data were collected through questionnaire from the customers of Dhaka Bank Ltd, Prime Bank Ltd and Bank Asia Ltd.
  • Secondary Data: Secondary data were collected from Annual reports of Dhaka Bank Ltd, Other intern report of Dhaka bank and some of employees of Dhaka Bank Ltd.

Result of the analyzes

In that research analyses use “Parasuraman, Zeithaml, and Berry (1988)” five dimensions

  1. Reliability
  2. Responsiveness
  3. Assurance
  4. Empathy
  5. Tangibles


In reliability dimension, the average result shows that Dhaka Bank receives a mean scoreof 4.34375 whereas the mean score for Prime Bank is 4.2188 and Bank Asia is 4.3125.


In Responsiveness dimension, the average result shows that Dhaka Bank receives a mean score of 3.82813 whereas the mean score for Prime Bank is 3.7188 and Bank Asia is 3.6719.

Assurance: In assurance dimension, Dhaka Bank receives a mean score of 4.0625, Prime Bank is 3.9063 and Bank Asia is 4.0469.

Empathy: In Empathy dimension, Dhaka Bank receives a mean score of 4.20313, Prime Bank is 4.0938 and Bank Asia is 4.1563.

Tangible: In Tangible dimension, the average result shows that Dhaka Bank receives a mean score of 4.54688 whereas the mean score for Prime Bank is 4.5469and Bank Asia is 4.5938.


  • As we all know Dhaka bank Ltd is one of the well-known banks in our country. From my little knowledge it’s quite hard to give recommendation to such a well-established bank.
  • On my perspective some suggestions for the improvements of service quality:
  • They should do more marketing activities to improve their presence in the minds of their potential target market. As we see that, Media coverage of Dhaka bank Ltd is not so strong. To attract new clients, they should go for mass media coverage like TV, Radio etc.
  • Dhaka Bank as a financial institution they need complimentary relationship among all the departments to run a process completely so they should try to be more active in their work. Different departments of the bank should work like a team to provide prompt and efficient services to the customers.
  • Dhaka Bank has only 89 branches all over the country. Since day by day their demand is increasing so it is quite hard to provide full range services with those branches. So they need to put more attention toward the expansion of branch network as well as online service so that they can easily get customer attention.
  • In Dhaka Bank Local brunch they can bring in more computers as Pay Order issue, Demand Draft, Cheque Book issue, Fixed Deposit etc. can be done by automated process rather than manual process. So they can increase the usage of these machines. While I was as intern I found out that there is always problem with the scanner and printer.
  • Customers ask for more quality service especially quick, accurate service and good behavior from the employees. As they think a private bank should provide such quality sufficiently behavior. So Dhaka Bank needs to notice about that and they need to improve their service quality and train their employees.
  • Dhaka Bank Ltd should start mobile banking service because it is very easy to carry money and its one of the secure and easy banking facility. Mobile banking is easy to pay and easy to get where ever people want.
  • Online customer service is one of the most familiar services in the whole world. So they need to focus on that service which is very important for Dhaka Bank Ltd for increasing and attracting customers.


On my experience as an intern at Dhaka Bank Ltd Behavior of everyone of bank is very polite and they are caring about the individual career and their achievement of assigned targets is awarded.

In Dhaka Bank Limited Employees are quite efficient. They have to bring their bank among the list of good banks. Employees are given the benefits like bonus, gratuity funds, loans, increments, and medical. All the customers are entertained individually.

The bank hopes to achieve a satisfactory level of progress in all areas. A group of officers and staffs, who always try to provide the best service to the clients. They always monitor the different sectors and their position. Before providing the loan they analyze whether the loan will be profitable and whether the client is good enough to repay the loan within the given period of time.