Focusing on Complaints Handling for Customer Satisfaction and Loyalty: The Case of Indonesian Public Banking

A. Salim, M. Setiawan, R. Rofiaty and F. Rohman

European Research Studies Journal, 2018, vol. XXI, issue 3, 404-416

Abstract: The purpose of this study is to examine and explain the effect of customer complaints handling and the quality of bank services on customer loyalty to public sector banks owned by the government in Jakarta, Indonesia. These banks have been the subject of several complaints to the Indonesian Consumer Foundation and the Financial Services Authority.The variables in this study are the quality of bank service (6 indicators), the handling of customer complaints (4 indicators), the customer loyalty (3 indicators) and the customer satisfaction (5 indicators). A total of 275 respondents from four state-owned commercial banks have been used.The study presents a proposed conceptual model, which is a key determinant of customer loyalty. The results show that the quality of the service has a positive effect on satisfaction, but the quality of service does not affect customer loyalty. Customer complaints have a positive effect on satisfaction, but the handling of customer complaints has no effect on customer loyalty. The customer satisfaction has a positive effect on customer loyalty. The result of mediation path hypothesis testing shows that the influence of service quality on customer loyalty can be mediated by customer satisfaction showing positive relationship. The influence of complaints on customer loyalty can be mediated by customer satisfaction showing a positive relationship also.Complaint handling has the greatest coefficient value in creating customer satisfaction and impacting customer loyalty. The study develops a framework for further research with more variables and indicators.

Keywords: Quality of bank service; handling customer complaints; customer satisfaction; customer loyalty; public sector banking. (search for similar items in EconPapers)
Date: 2018
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

Downloads: (external link)
https://www.ersj.eu/dmdocuments/2018_XXI_3_32.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ers:journl:v:xxi:y:2018:i:3:p:404-416

Access Statistics for this article

More articles in European Research Studies Journal from European Research Studies Journal
Bibliographic data for series maintained by Marios Agiomavritis ().