Factors of Customer Loyalty in Banking Industry

1.1 Introduction

Banks are playing a very important role in the economic development of a nation. The healthiness of the economy is directly connected to the soundness of its banking system. The role of banks has placed them as a very valuable partner in the process of economic development. Nowadays, banks are very useful for the utilization of the assets of a nation. If there would be no banks then a large segment of assets in the country would stay idle.

It is possible to attaining long-term success in the banking sector by providing excellent customer service. It is an effective strategy for taking full advantage from the engagement between customers with organizations and also offering a competitive edge to survive in this tough market environment. The profitability and sustainability of any businesses are mostly depends on how long the services and products their customers hold. Matter- of-course, the banking sector is not an exception to this concept; all of the banks attempt to make a different by using their customer service strategy and give their customers an exclusive experience with their products and services. The primary aim of them is to assure and win their loyalty for their company.

In order to accomplish this, each bank wishes to offer an outstanding service towards their customers. If a firm failed to keep and improve their services, it is impossible for them to accomplish their targets. So, customer loyalty can be said as a remarkable strategic objective for businesses. While studies on customer loyalty have been prolific within the marketing fulcrum (Mittal and Lassar, 1998; Teich, 1997; Aydin and Ozer, 2004; and Rowley, 2004), especially within the developed countries, the literature appears deficient in countries such as Indian. Hence, achieve customer satisfaction and loyalty is crucial to banks success and also acts as the key contribution to sustainable profit growth.

1.1 Research Background

The ongoing reforms

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