Customer Satisfaction and Customer Loyalty in the Banking Sector in Mbarara City: A Case of Stanbic Bank
Abstract
Customer loyalty is a crucial aspect for organizations, especially in the banking sector, due to its significant financial benefits. Banks, being high-involvement service providers, maintain long-term relationships with customers, making customer satisfaction vital. While customer loyalty is a well-explored topic globally, limited research has been conducted in developing countries, particularly Uganda. This study aims to assess the influence of customer satisfaction on customer loyalty in the banking industry in Mbarara City, Uganda, with Stanbic Bank's Mbarara Branch as a case study. The study's objectives include evaluating customer satisfaction and loyalty levels and determining their correlation. The methodology involved a descriptive cross-sectional survey of 50 respondents, including management, employees, and customers, using both quantitative and qualitative approaches. Data analysis was performed using SPSS to test the correlation between satisfaction and loyalty. Findings indicated a positive relationship between service quality, trust, and long-term relationships with customer satisfaction. Similarly, trust and repeat purchases were linked to customer loyalty. Recommendations suggest banks should enhance customer follow-ups, innovate banking services, and host customer feedback events. Further studies could explore factors hindering customer satisfaction, the role of technology, and the impact of savings and credit societies on loyalty to commercial banks.
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