GROUP ASSIGNMENT

SERVICE QUALITY AND CUSTOMER TRUST TOWARD CUSTOMER

LOYALTY, EFFECT OF CUSTOMER SATISFACTION IN AFFIN BANK

PROGRAMME CODE : BA734

COURSE : CUSTOMER BEHAVIOUR IN A SERVICE
ENVIRONMENT (OCS 713)
GROUP : BA7341B
PREPARED FOR : ASSOCIATE PROFESSOR DR. LENNORA BINTI
PUTIT
SUBMISSION DATE : 20 JANUARY 2022

PREPARED BY :

STUDENT NAME STUDENT ID

AIMAN IDAYU BINTI GHAZALI 2021667778
SITI ZAINURA BINTI ABDUL LATIF 2021641614

ACKNOWLEDGEMENT
In the name of Allah s.w.t., the Most Merciful and Beneficent. Thank you, Allah s.w.t, for
providing us the strength to finish this collective project. We are grateful to our lecturer,
Associate Professor Dr Lennora binti Putit, for providing us with complete supervision,
insight, attention, and encouragement during this group work. Thank you once again for
everything! All of our replies deserve our sincere gratitude and heartfelt gratitude for their
insightful comments. Their willingness to complete the questionnaire in the time allotted is
really beneficial to us in running this little study efficiently. This mini-study would certainly
be impossible to complete without their cooperation. We would like to show our gratitude to
everyone of our classmates and coworkers for their contributions.

TABLE OF CONTENTS

PAGE
1 INTRODUCTION
 Overview and Background of the study 1-2
Problem statement
Research objectives
2 LITERATURE REVIEW 3-8
Definition of Service
The Characteristics of Services
Dimensions of Service Quality
Loyalty
Satisfaction
Trust
Conceptual Framework of the Study

3 RESEARCH METHODOLOGY 9-11

Type of reserach
Study setting - hypothesis
Secondary data analysis
4 FINDINGS ANALYSIS AND DISCUSSION 12-23
Demographic Output
Gender
Age
Education level
Occupation
Frequency of visiting
Tenure with the bank
Income
Customer service quality in Affin Bank
Total means of customer service quality in Affin Bank
Level of customer’s satisfaction in Affin Bank
Means of customer’s satisfaction in Affin Bank
Relationship between service quality and customer satisfaction in
Affin Bank
5 CONCLUSION AND RECOMMENDATION 24
6 REFERENCES AND APPENDIX 25-30

ABSTRACT
In order to succeed in today's intensely competitive climate, Affin Bank must place a
premium on client loyalty. The purpose of this study is to see how different aspects of
customer loyalty impact the respondents' behaviour and intentions. The current study has
three goals: first, assess the customer service quality of the bank, secondly to examine the
relationship between trust and service quality towards customer’s satisfaction in Affin Bank.
Thridly, to examine the relationship between customer’s satisfaction towards customer’s
loyalty.Questionnaire was used to collect data from a sample of 300 respondents using non-
probability convenience sampling. Using SPSS 26, the acquired data was analysed using the
statistical techniques such as frequency table, reliability test and ANNOVA. The current
study's findings show that customer loyalty is influenced by trust, customer satisfaction, and
service quality and customer satisfaction do contribute to customer’s loyalty by trust.

Keywords: Customer Loyalty, Customer Satisfaction, Service Quality, Trust and Affin Bank
INTRODUCTION

Overview and background of the study

According to Oliver (1999), loyalty is a firmly held commitment to repurchase or patronise a

favoured product or service on a regular basis in the future. Customer loyalty may be
developed through discovering, controlling, and meeting the demands of customers (Maikayi
et-al,2011). It is essentially a mix of the positive opinions of customers and their repurchase
actions. Customer loyalty is a point of convergence for numerous commercial affiliations,
and it ensures the success of organisation agreements, which may be influenced by
management activity (Gerpott Rams & Schindler, 2001). Because of fierce competition and
greater client demands, customer loyalty has been a major problem for banking professionals.
Customer loyalty is seen as a vital link between hierarchical success, benefit, and business
performance (Oliver, 1997; Reichheld,1993; Sheth and Parvatiyar, 1995). Customers that
display the highest degrees of dependability when it comes to a goods or a service activity are
more likely to repurchase and spend more money. As a result, loyal consumers not only
increase the value of the firm, but also enable it to maintain costs lower than those associated
with obtaining new customers (Barroso and Martin, 1999). According to Shoemaker and
Lewis (1999), marketing has changed from customer acquisition to customer loyalty and
retention. Furthermore, Mcllory and Barnet (2000) state that to get new customer is five times
costly to maintain existing customers. Loyal customers will always give positive comments
and recommendations about the company to others. Firms can maximize level of profitability
by providing safe and sound products and services to loyal customers. One way to improve
customer loyalty in account management is to focus on providing exceptional services that
meet the demands of the client. Banks must be proactive in their approach.have a good grasp
of their customers' behaviour so that effective marketing techniques may be implemented is
possible to design a strategy for relationship building and client retention. The classic
method,in conformity with the new regulations, a product-oriented bank is becoming
increasingly customer-oriented.relational marketing's key concepts, which focuses on client
loyalty. The research areas/domains to be investigated is the relationship quality determinants
and outcomes in Affin bank customer’s satisfaction and trust of the service quality will affect
the customer loyalty. Because of the lack of concreteness of exceptional service outcomes,
functional attributes associated with customer satisfaction (i.e. how the service is delivered),
such as accessibility, professionalism, and empathy of customer service representative, are
likely to play a significant role in the consumer's evaluation of the bank relationship with

1
customer’s loyalty. The importance of service quality isn’t only demonstrated by the lost of
customers if the quality is subpar. Getting customer’s right offers gains for Affinbank
business as well.On top of that , good service can prompt customers to spend more and more
likely to be loyal to the bank and the most important, good service creates trust and
recommendations to others.

Problem statement

Quality of service is seen more than a key differentiator in the banking industry, however
there are challenges which influence the service quality of a small bank in Malaysia such as
Affin Bank. Hence , the study determines how the identified factors impact the customer’s
satisfaction level of Affin Bank. The bank need to strive for constant progress in enhancing
service, thus there is an urge to determine the predictive factors that affect the quality of
service of Affin’s customer service and therefore would help the management to identify the
areas of improvement to create trust and thus loyalty.Gong & Yi, 2018; Famiyeh et al,
( 2018) found a significant relationship between quality and customer’s
satisfaction.According to Mantey and Naidoo, (2017) contributed to the body of knowledge
that customer satisfaction leads to brand repurchased and eventually brand loyalty. Similarly
the findings of other authors Bakar et al , (2017).

Research objectives

This research is to assess the customer service quality of the bank,to examine the relationship
between trust and service quality towards customer’s satisfaction in Affin Bank and
furthermore to examine the relationship between customer’s satisfaction towards customer’s
loyalty.

2
LITERATURE REVIEW

This chapter focuses on the review of the literature associated with customer service

quality,customer satisfaction, trust and loyalty. This study proposes a new empirical model
about the causal relationship between the service quality and customer trust toward customer
loyalty which is mediated by customer satisfaction.

Definition of Service

The definition of services according to Lovelock and Wright (2007) in their book,
Management and Service Marketing, is the act or performance offered by one party to
another party. Although the process may be associated with a tangible product, its execution
is essentially fictitious and does not usually result in ownership of the component of
production. It is possible that producing services may not necessitate the usage of actual
objects. However, if this occurs, there will be no transfer of title (permanent ownership) or
evaluation of these tangible things. It can be stated that intangible services are fundamental
services that do not have ownership rights but can bring satisfaction, and in generating related
services, may or may not be tied to the physical object.

The Characteristics of Services

According to Kotler and Amstrong (2012) in their book, Marketing Mix and Consumer
Loyalty, services have four main characteristics which are Intangibility, Inseparability,
Perishability, and Variability. These elements have an impact on the design of a marketing
programme. Consumers are unable to see, smell, feel, hear, or experience the results of
services before purchasing them due to intangibility. To eliminate ambiguity, consumers will
seek information about these services, such as the company's location, service providers and
distributors, equipment and modes of communication used, and the prices of these services.

The second characteristic, Inseparablity, means that services cannot be separated from its
source, the service company which produces it. When services is produced, it will be
consumed at the same time. If a consumer buys a service, he or she will directly deal with the
source or provider of such service; therefore, direct sales with the limited scale of operation
will be preferred. To solve this problem, the company can use several strategies, such as
working in a large group, working faster, and training the services providers so that they can
build customer trust.

3
The third attribute, Variability, represents the reality that services are produced on an
individual basis for each customer, hence no two services will be identical. As a result,
customers are faced with uncertainty and will undoubtedly seek to minimise risk. They
frequently seek counsel from others or go for services that come with adequate warranties.
The best method for businesses to eliminate inequality is to locate and train influential
workers. If customer demand changes, the organisation will have a tough time preparing its
services. To overcome the imbalance between demand and supply of services, good planning,
pricing, and promotion of relevant programmes are required.

Service quality is how far the difference between the real quality of service and the
expectation of customers and difficult for consumers to assess service quality when compared
to the quality of the product.Service quality relies upon the capacity of firms to manufacture a
solid service character through corporate correspondence systems, because, as featured by the
more positive the service personality is seen by purchasers, the higher the demeanor shoppers
have towards the service technique, (Hapsari, et al. 2017).

Customers must first try a service before deciding whether they are happy or unsatisfied with
the results. Quality judgements are frequently made regarding services that have never been
used, based on comments from acquaintances or advertising messages, and may not
necessarily represent personal experience. Because the penalty of poor service quality may be
as high as 40% of revenue in certain service businesses, managing a firm to maximise
customer happiness is a strategic priority for many companies. Customer satisfaction should
improve if service qualities are improved, most firms recognise. As a result of this increase,
client retention and quality should improve (Lovelock and Wright, 2002, pp. 266). According
to Parasuraman et al. (1988), there are five aspects in assessing service quality are reliability,
assurance, tangibility, empathy, and responsiveness.

Dimensions of Service Quality

The performance should be in accordance with customers’ expectations, which means that it
has punctuality and gives equal services to all customers with zero error, sympathetic
attitude, and high accuracy. Assurance, knowledge, politeness and the ability of the
company's employees to foster a sense of trust of the customers to the company. It includes
several components, among others, communication, credibility, safety (security), competency
and manners (courtesy). Competence itself is the skills and knowledge possessed by the
employees to perform the services, while manners include hospitality, attention and attitude

4
of the employees. Credibility covers things that correlate with trust to companies such as
reputation and achievement. Next dimension is Tangibility, which represents the appearance
and the functions of physical infrastructure of the company; for example physical facilities
such as a comfortable space with chairs provided for customers to sit, fixtures, and equipment
used (technology) as well as the appearance of the employees. This is considered as a form of
a company's ability to demonstrate its existence to external parties. In terms of Empathy, a
company is expected to know and understand the customers, understand that customers’
needs are specific, and have a comfortable operation for the customers in the form of
providing genuine concern and the individual or individuals that is provided to customers by
striving to understand the wishes of consumers. The last dimension, Responsiveness, is
defined as a policy to assist and provide prompt service that is precise and responsive to
customers with clear information delivery.

Service businesses devote a significant amount of time and resources to assessing and
controlling client happiness, loyalty, and service quality. Many researches have concentrated
on building a'scale' to assess service dimensions and consumers' perceptions and expectations
in relation to these ideas. Much of the subsequent research in services employed the
SERVQUAL scale after its introduction in the 1980s. During the late 1980s and 1990s,
however, various scales were developed to focus on other areas of service quality, customer
happiness, customer loyalty, and consumer perceptions. Companies are more likely to
appreciate the value of maintaining current consumers as marketplaces grow more
competitive. Customer retention is seen to be a simple metric to track and a dependable
predictor of high performance. The most often used techniques for calculating and assessing
service quality are SERVQUAL, SERVPERF, scales for measuring customer satisfaction and
loyalty, critical incidents technique, focus group discussions, and in-depth interviews. In this
study a hybrid of SERVQUAL and Causal relationship model.

Loyalty

Srivastava and Rai (2014) suggested that loyalty as a concept and construct has engendered
sizeable research interest, and thus researchers took it upon themselves to explore it more by
reverting to its originators. McCall and Voorhees (2010), in their research. focussed on
identifying the drivers responsible for customer loyalty programmes, asserted that “the
drivers of loyalty remain elusive” (p. 36). The renowned reflection by Oliver (1999),
“Whence Customer Loyalty?” still poses a considerable challenge before marketers across

5
industries worldwide, and the most obvious answer would seem to be “customer
satisfaction”. Bearden and Teel (1983) asserted that customer satisfaction “is generally
assumed to be a significant determinant of repeat sales, positive word of mouth and consumer
loyalty” (p.21). Researchers established positive links between customer satisfaction and
various aspects of customer loyalty such as relative attitude (Dick and Basu, 1994), reduced
intensity of blame and anger in impaired relationships (Forrester and Maute, 2001),
repurchase intentions s (Reichheld and Sasser, 1990; Zeithaml et al., 1996; Mittal and
Kamakura, 2001; Faullant et al., 2008), repeat usage intentions (Bitner, Booms and Tetreault,
1990; Jones and Suh, 2000), willingness to recommend (Howat et al.,1999; Faullant et al.,
2008), and customers’ future intentions (Murray and Howat,2002).

While satisfaction has often been regarded as the most obvious sign of customer loyalty
(Anderson et al., 1994; Anderson and Sullivan, 1993; Bearden and Teel, 1983; Bolton and
Drew, 1991; Fornell, 1992; LaBarbera and Mazursky, 1983; Oliver, 1980; Oliver and Swan,
1989a, b; Rust et al., 2002; Rust and Zahorik, 1993), delivering a satisfactory customer
experience over and over again, howsoever difficult that may be, does not earn the company
much credit. Few customers have been expressly vocal about their consumption experience
when a product has fulfilled all the promises it stands for. Moreover, the impact of customer
loyalty or reward programmes on the actual state of loyalty and consequent performance of a
firm is still not established (McCall and Voorhees, 2010). Smith and Sparks (2008) and
DeKay et al. (2009) pointed out that customer loyalty programmes see participation in
millions. Yet, as highlighted by O’Brien and Jones (1995), Dowling and Uncles (1997), and
Bolton et al. (2000) there are still doubts about their effectiveness. O’Brien and Jones (1995)
also argued that unsound design of reward structures under loyalty programmes may lead to
repeat buying behaviour among “undesirable” sets of customers. McCall and Voorhees
(2010) opined that in a scenario where the value of rewards is greater than the product it
accompanies, or when such rewards lack reinforcement for loyal customers, firms may end
up securing only short-term buying with no effect on customers’ attitudes and future
intentions. Customer loyalty calls for an association deeper and stronger than cognitive
judgements or accumulated benefits. The character of loyalty is created when a relationship
tacitly transcends the boundary of satisfaction to assimilate with emotional attachment. It is
the point where a customer’s cognitive evaluations are equalled or even overpowered by the
strong emotional and affective dynamics of the company-customer relationship. Thus, it is
the confluence of customer satisfaction and customer’s emotional attachment which together

6
engenders customer loyalty in its truest form. The sections that follow proffer individual
discussions about the creation and construction of satisfaction and emotional attachment.

Satisfaction

Homburg et al. (2006) highlighted the interest received by customer satisfaction from
academicians and researchers in the field of marketing and consumer studies over the years.
Spreng et al. (1996) pointed out that customer satisfaction is deep-seated in the concept of
marketing and refers to satisfying the needs and desires of customers. Giese and Kote (2000),
while reviewing the available literature on customer satisfaction found inconsistency in
satisfaction definitions. Peterson and Wilson (1992) noted that customer satisfaction studies
lacked “definitional and methodological standardization” (p. 62).Yi (1990) opined that "For
the field of consumer satisfaction to develop further, a clear definition of consumer
satisfaction is needed" (p.74).

Satisfaction is pleasure or gratification largely perceived as a cognitive process involving

evaluation of perceived performance against preconceived expectations. Customer
satisfaction/ dissatisfaction is the cognitive judgement of a customer resulting out of an
interaction between the customer’s personality and the company’s marketing practices from
the perspective of the expectation that the customer had with the product, and perception of
the benefits received. Howard and Sheth (1969) referred to customer satisfaction as the
cognitive state of a buyer which results from his feeling of being sufficiently or insufficiently
rewarded for the benefits he has foregone. According to Oliver (1980) customer satisfaction
is a summary psychological state characterised by the association of emotions surrounding
disconfirmed expectations and consumer’s previous evaluations about the consumption
experience. Hence, satisfaction is the outcome of customers’ favourable evaluative
judgements about the extent to which a product’s performance could meet their expectations,
and customer satisfaction is considered essential for profitability of the business as it
increases the strength of customers’ revisit and repurchase intentions. Being a post-
consumption psychological state, satisfaction is inescapably attached to the possibility of
dissatisfaction where customer’s negative experience results in disappointment and dissent.

Trust

Customer loyalty and relationship commitment are both influenced by trust. When one party
has faith in the other, that side is willing to generate good behavioural intentions toward the
other. As a result, when a client trusts a company or brand, he or she is more likely to have a

7
favourable purchase intention for that company. Reciprocal arguments support the link
between consumer trust and customer loyalty. When service providers perform in a way that
creates customer trust, the customer's perceived risk of interacting with them is lowered,
allowing the consumer to make confident predictions about their future interactions with
them. Trust promotes loyalty through influencing the consumer's impression of value
congruence with the service provider, and this value congruence is linked to customer
happiness and loyalty. Customer loyalty is influenced by trust (Aydin & Ozer 2005: 146;
Chen & Xie 2007: 64; Du Plessis 2010: 91–92). The building of trust is also seen as a
significant benefit of engaging in a dyadic and emotional connection between the partners.
Increased trust is recognised as crucial to the customer-business relationship's success (Huang
& Chiu 2006: 157).

Conceptual Framework of the Study

This study proposes a new empirical model about the causal relationship between service
quality and customer trust toward customer loyalty effect of customer satisfaction in Affin
Bank (see Figure1). However, the next chapter explains the research methodology is used to
collect primary data, determine sample size, design of data collection instrument, and
approach to data analysis.

Figure 1:

Customer
satisfaction

Service
Trust
Quality

Customer
Loyalty

Dependent Variable : Customer loyalty

Independent Variable : Customer satisfaction, trust and service quality.

8
RESEARCH METHODOLOGY

Type of research

A quantitative research methodology model with a coordinated approach was followed, as

will be indicated and motivated below.The questionnaire was drawn up to establish Affin
Bank customers on the service quality, as well as their satisfaction, trust and loyalty levels.
They were asked to rate certain statements that were adapted from the selected service quality
model see Table 1.

Hypothesis

H1: Customer Satisfaction has significant relationship with Customer Loyalty.

H2: Trust has significant influence on Customer Satisfaction

H3: Trust has significant influence on Customer Loyalty

H4: Higher the Service Quality higher will be the Customer Satisfaction.

H5: Higher the Service Quality higher will be the Customer Loyalty.

The scales of the study were adopted from the previous literature and published studies. Data
on the variables is collected using index scale, i.e using different items to measure the
responses of the respondents for measuring the sensitivity factor. Two variables naming
customer satisfaction and trust have four items while customer loyalty and service quality are
measured using five items, see Table 1. Method chosen was quantitative method which the
questionnaire was prepared to record the responses. A sample of 300 respondents.
Convenience sampling method was used to collect data. A non-probability convenience
sampling is used in the study.The population was defined as all Affin Bank customers
external and internal.Population for our research was Affin Bank’s customer in the Central
region consists of (Selangor, Kuala Lumpur and Negeri Sembilan).To ease the distribution of
data during the pandemic situation, questionnaires were distributed using the electronic form
(google form) for population groups. SPSS-statistical programmes were used to analyse the
data once it had been collected. The following statistical techniques were used in this study:

9
 Frequency tables were used as a descriptive tool to provide more details about the
demographic details of the target groups, as well as the basic results of each question in the
questionnaires.

 The factor scores were calculated in all instances.

 Reliability tests like the Cronbach-alpha test were done to determine the internal
consistency of the sample groups’ results.

 The descriptives of the different factors were also identified. This included the the analysis
of variance (ANOVA) which determines whether the means of the different groups were
equal and could be generalised on.

 Correlations between the different factors or components were also done in detail, as it
helped to show a predictive relationship that can be utilised and developed in practice. The
above statistical techniques were adequate to achieve the mentioned objectives of this study,
and rate the following research questions.

Table 1

No Variable Items Reference

I am satisfied with the decision to choose this
Wang et al.
Customer bank
(2001),
1 Satisfactio This bank leaves me a pleasant impression
Llosa
n I want to return to this bank in the future
(1996)
I will advise about this bank to my friends.
I regularly visit this bank Boulaire et
I seldom think of changing this bank to another Mathieu
one (2000),
Customer I use this bank each time I need to make any Srinivasan
2
Loyalty financial transaction et al.
I consider this bank as my preferred choice (2002),
Each time I want to make any financial transaction, Huang
this bank is my first choice. (2008).

10
 Hess(1995)
, Jarvenpaa
&
Tractinsky
(1999),
This bank keeps my information confidential.
Gurviez &
This bank is honest.
3 Trust Korchia
This bank is reliable.
(2002),
This bank meets my needs
Gefen et al.
(2000),
Chiou &
Droge
(2006)
Ease of depositing and withdrawing money from any
branch Adapted
Continuous and ordered functionality of equipment from
Service such as computer and printer etc Jannatul
4
Quality Staff takes interest in solving problem bank Mawa
Maintains error free records Nupur
Information provided by bank employees are clear (2010)
and understandable.

11
FINDINGS AND ANALYSIS

This chapter discussed the results of the data analysis, which covered the study's primary
objective.

Demographic Output

Gender

Valid Cumulative
Frequency Percent Percent Percent

Valid Male 152 50.7 50.7 50.7

Female 148 49.3 49.3 100.0

Total 300 100.0 100.0

Gender
100%
80% 49.3
60%

40%
50.7
20%

0%
Male Female
Per

Age

Valid Cumulative
Frequency Percent Percent Percent

Below 21 27 9.0 9.0 9.0

years

21 - 34 years 87 29.0 29.0 38.0

12
35 - 50 years 106 35.3 35.3 73.3

Over 50 years 80 26.7 26.7 100.0

Total 300 100.0 100.0

Age
100%
90%
80%
70%
60%
9 35.3 26.7
29
50%
40%
30%
20%
10%
1 3 4
2
0%
Below 21 years 21 - 34 years 35 - 50 years Over 50 years

Education level

Frequenc Valid Cumulative

y Percent Percent Percent

Valid Completed high 100 33.3 33.3 33.3

school

Diploma 59 19.7 19.7 53.0

Degree 110 36.7 36.7 89.7

Post graduate degree 31 10.3 10.3 100.0

(masters or doctorate
degree)

Total 300 100.0 100.0

13
 Education Level
90%
60%
30%
0%

Occupation

Valid Cumulative
Frequency Percent Percent Percent

Valid Government 49 16.3 16.3 16.3

Employee

Private Employee 181 60.3 60.3 76.7

Student 26 8.7 8.7 85.3

Trader 44 14.7 14.7 100.0

Occupation
100%
80%
60% 8.7 14.7
16.3 60.3
40%
20%
3 4
0% 1 2
Government Private Employee Student Trader
Employee

Frequency of visiting

14
 Valid Cumulative
Frequency Percent Percent Percent

Valid Daily 13 4.3 4.3 4.3

Weekly 14 4.7 4.7 9.0

Two times a 31 10.3 10.3 19.3

month

Monthly 184 61.3 61.3 80.7

More than a 58 19.3 19.3 100.0

month

Total 300 100.0 100.0

Frequency
100%
90%
80%
70%
4.7 10.3
60% 4.3 19.3
50% 61.3
40%
30%
20%
2 3
10% 1 5
0% 4
Daily Weekly Two times a Monthly More than a
month month

Tenure with bank

Valid Cumulative
Frequency Percent Percent Percent

Valid Less than 1 year 41 13.7 13.7 13.7

1- 5 years 46 15.3 15.3 29.0

6-10 years 57 19.0 19.0 48.0

15
 10-15 years 68 22.7 22.7 70.7

More than 88 29.3 29.3 100.0

15years

Total 300 100.0 100.0

Tenure with the bank

100%
80%
60% 15.3 19 22.7 29.3
13.7
40%
20%
1 2 3 4 5
0%
Less than 1 1- 5 years 6-10 years 10-15 years More than
year 15years

Series1

Income

Frequenc Valid Cumulative

y Percent Percent Percent

Valid under RM1,000 29 9.7 9.7 9.7

RM1,000 - 29 9.7 9.7 19.3

RM2000

RM2001 - 99 33.0 33.0 52.3

RM4000

RM4001 - 118 39.3 39.3 91.7

RM8,000

Over RM8,000 25 8.3 8.3 100.0

Total 300 100.0 100.0

16
 Income
100%

80%
8.3
60% 9.7
9.7 33 39.3
40%

20% 5
1 2 3 4
0%
under RM1,000 - RM2001 - RM4001 - Over RM8,000
RM1,000 RM2000 RM4000 RM8,000

The demographic characteristic of this study. Data analysed male is 152 (50.7%) meanwhile
female is 148 (49.3%). Age of the respondent shows that most of them are from age 35 – 50
years old with 106 (35.3%), followed by 21- 34 years with 87(29%), > 50 years old with 80
(26.7%), and < 21 years old with 27 (9%). The education level of the respondent shows that
most of them have a degree with 110 (36.7%), 100 ( 33.3%) completed their high school, 59
(19.7%) has diploma, and 31 ( 10.3%) have postgraduate either master or doctorate
qualification. In addition, for the occupation self- employee show as the highest occupation
of the respondent with 181(60.3%), followed by 49(16.3%) as government servants,
44(14.7%) as traders, and 26(8.7%) as students. Most of the respondents had monthly visiting
Affin Bank with 184(61.3%), followed by twice times in a month 31(10.3%), weekly
14(4.7%), and daily 13(4.3%). In term period of establishing a relationship with the bank
show that respondent need more than 15 years 88(29.3%), 10 – 15 years with 68 (22.7%) ,
followed by 57 respondents (19%) establish within 6 – 10 years , 1- 5 years 46(15.3%) and
lastly less than one year with 41( 13.7%). Most income of the respondent is RM4001-
RM8000 which is 118 (39.3%) , followed by income RM 2001 -RM4000 with 99 (33%) of
respondents , and 29 (9.7%) show respondent have income of RM 1001 -RM 2000 and
<RM1000.

17
Table 4.2 customer service quality in Affin Bank
Rating Scale n (%)
Variable Strongly Disagree Neutral Agree Strongly
Disagree agree
Continuous and ordered 0(0) 20(6.7) 3(1.0) 229(76.3) 48(16)
functionally of equipment
such as computer and
printer, for example, the
bank (Affin Bank) has up-
to-date equipment and
technology (buildings,
chairs, table, parking areas
and other).
The staff takes interest on 1(0.3) 3(1.0) 8(2.7) 233(77.7) 54(18.0)
solving problems which is
staff Affin Bank delivers
promise in timely manner
and the employees
sympathetic to solving
problem customer
Ease of depositing and 1(0.3) 1(0.3) 13(4.3) 235(78.3) 20(16.7)
withdrawing money from
any branch, for example,
Affin Bank branch
performs service right the
first time.
Affin Bank maintains error 1(0.3) 1(0.3) 19(6.3) 230(76.7) 49(16.3)
free records for example
Affin Bank branch charges
reasonable fee for the
administration of the
account
Information provided by 1(0.3) 1(0.3) 32(10.7) 201(67) 65(21.7)

18
 Affin Bank employee are
clear and understandable
for example Affin Bank
branch have knowledge to
answer customer’s
questions.
*Descriptive (n:300)

Table 4.2 showed data for customer service quality characteristics for this study. From
the data analyzed found respondents found that “Ease of depositing and withdrawing money
from any branch, for example, Affin Bank branch performs service right the first time” with
235(78.3%) stated agreed and 20(16.7% ) strongly agreed, followed by “Staff takes interest
on solving problems which are staff Affin Bank delivers promise in a timely manner and the
employees sympathetic to solving problem customer” with 233(77.7%) agreed and
54(18.0%) strongly agreed. Characteristic services quality of “Ease of depositing and
withdrawing money from any branch, for example, Affin Bank branch performs service right
the first time” show that 235(78.3%) agreed and 20(16.7%) strongly agreed. In addition,
“Continuous and ordered functionally of equipment such as computer and printer, for
example, the bank (Affin Bank) has up-to-date equipment and technology (buildings, chairs,
table, parking areas and other) show respondent agreed with these services with 229(76.3%)
and strongly agreed 48(16%). Lastly. “Information provided by Affin Bank employee is
clear and understandable for example Affin Bank branch has the knowledge to answer
customer’s questions” with 201 (67%) agreed and 65 (21.7%) strongly agreed.

Table 4.3 total means of customer service quality in Affin Bank

Level n (%) Minima maxima Mean SD
Customer 300 (100) 1.00 5.00 4.0651 0.5212
satisfaction
*Descriptive (n:300)
Table 4.3 shows the total means of customer service quality in Affin Bank which is
the score minima is 1 and maxima is 5. The minima indicate a low level of the services and 5
is the highest indicates as good quality of services. The total mean quality services of this

19
study are 4.0651 with a standard deviation (SD) of 0.5212. This result indicates that
respondent agreed that this bank has good quality services.

Table 4 variables of customer’s satisfaction in Affin Bank

Rating Scale n (%)
Variable Strongly Disagree Neutral Agree Strongly
Disagree agree
I am satisfied with 1(0.3) 1(0.3) 25 (8.3) 185(61.7) 88(29.3)
the decision to choose
this bank (Affin
Bank)

This bank (Affin 1(0.3) 1(0.3) 23(7.7) 194(64.7) 81(27.0)

Bank) leaves me with
a pleasant impression.

I won’t return to this 188(62.7) 54(18.0) 45(15.0) 1(0.3) 9(3.0)

bank (Affin Bank) in
the future
I will advise about 1(0.3) 1(0.3) 32(10.7) 201(67) 65(21.7)
this bank (Affin
Bank) to my friends
*Descriptive (n:300)

Table 4.4 shows the level of customer satisfaction characteristic in Affin Bank which
is patients agreed will advise about this bank (Affin Bank) to their friends with 201(67%) and
strongly agreed 65(21.7%). In addition, respondents were satisfied to give the pleasant
impression with 194(64.7% ) and strongly agreed 81(27.0%). Respondent also will return to
this bank with highest 188(62.7%) strongly disagreed with the statement “I won’t return to
this bank (Affin Bank) in the future”. Lastly, respondents show that agreed “I am satisfied
with the decision to choose this bank (Affin Bank)” with 185(61.7%) and strongly agreed
88(29.3%).

20
Table 5 total means of customer’s satisfaction in Affin Bank
Level n (%) Minima maxima Mean SD
Customer 300 (100) 1.00 5.00 4.0983 0.5432
satisfaction
*Descriptive (n:300)

Table 5 shows the total means of level of customer’s satisfaction in Affin which is the score
minima is 1 and maxima is 5. The minima indicate a low level of the services and 5 is the
highest indicates as good quality of services. The total mean customer satisfaction of this
study are 4.0983with a standard deviation (SD) of 0.5432. This result indicates that
respondents agreed that they statisfied that this bank services.

Table 6 The relationship between service quality and customer satisfaction in Affin.

Sum of Squares df F Sig.

Between Groups 30.187 10
Within Groups 32.972 289 26.459 0.000
Total 63.160 299
(n:300) * One-Way ANOVA

Table 6 shows the relationship between service quality and customer satisfaction at
Affin. Data analysis found there is a significant relationship between service quality and
customer satisfaction at Affin with a p-value 0.000 where (p<0.05).

Table 7 The relationship between customer satisfaction towards customer loyalty

Sum of Squares df F Sig.
Between Groups 35.124 12
Within Groups 53.100 287 15.820 0.000
Total 88.224 299
(n:300) * One-Way ANOVA

21
 Table 6 shows the relationship between customer satisfaction towards customer
loyalty at Affin. Data analysis found there is a significant relationship between customer
satisfaction towards customer loyalty at Affin with a p-value of 0.000 where (p<0.05).

Cronbach alpha

Reliability Statistics
Cronbach's Cronbach's N of
Alpha Alpha Items
Based on
Standardize
d Items
.815 .900 24

Cronbach’s alpha, α (or coefficient alpha), developed by Lee Cronbach in 1951, measure’s
reliability, or internal consistency. Cronbach’s Alpha ranges between 0 and 1, with higher
values indicating that the survey or questionnaire is more reliable. The general rule of thumb
is that a Cronbach's alpha of. 70 and above is good, . 80 and above is better, and. 90 and
above is best. This study indicates the reliability statistic test is .815 where indicates the
reliability standard is good.

22
DISCUSSION

The goal of this study is to find out how customer loyalty characteristics impact responders.
Throughout this research, some of the goals have been met. The independent variables (trust
and service quality) have positive relationship with customer satisfaction and customer
loyalty, whereas relationship of trust with customer satisfaction is also proven to have the
positive relationship. Results of our analysis have neglected the negative relationship of trust
and customer satisfaction which was proof in previous researches. Analysis results show the
overall satisfaction and loyalty of the customers with their respective banks but the rejection
of this hypothesis (relationship of trust with customer satisfaction) at the same time shows
that customers are satisfied with their respective banks but this satisfaction is not witnessed
by the facilities provided by the banks to create trust. It means that there are other factors
contributing to the satisfaction of the customers other than the variables taken in this research
as independent variable effecting customer satisfaction. Besides result shows that service
quality has a significant positive influence on customer loyalty p-value 0.000 where (p<0.05).
and also contributes to the customer’s satisfaction.

As noted in the literature review, several writers define customer loyalty as "repurchase
intention and behaviour of customers toward a specific product or service." Other than the
characteristics stated in our study, the existence of a restricted number of banks in the
research area and job holders with wages in government banks are two elements that
influence customer re-visit decisions. These characteristics, which were not accounted for in
our research owing to a restricted time frame and some unpredictable conditions, are some of
the reasons why consumers tended to remain loyal despite non-provision and unhappiness
with their bank's degree of trust.

23
CONCLUSION AND RECOMMENDATION

Despite consumer behavior changes from time to time if the banks are able to create loyalty
in their customers, for sure it will generate financial benefits. The loyalty of the customer
plays an important role for the success of any organization. The managerial implication of
this research are the considerations of bank managers for better, prompt and error free
services having empathy for customers, personalized treatment of the customers, for
customer satisfaction and their positive recommendation to others and also to build
customer’s trust in them in order to retain the customers.

24
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Zeithaml, V. A., Berry, L. L., & Parasuraman, A. (1996). The behavioral consequences of
service quality. J. Mark., 60(2), 31-46.
QUESTIONNAIRE

Section 1
Respondent’s profile Please circle one from each statement.

1. Please what is your gender?

A. Male
B. Female

2. Please select your age group.

A. below 21 years
B. 21 - 34 years
C. 35 - 50 years
D. over 50 years

3.Please indicate the highest level of education you have attained

A. Did not complete high school
B. Completed high school
C. Diploma
D. Degree
E. Post graduate degree (masters or doctorate degree)

4. What is your Occupation?

A. Government Employee
C. Self-employee
B. Private Employee
D. Student
E. Trader

27
F. Others

5. What is your frequency of visiting the branch to use its service?

A. Daily
B. Weekly
C. Two times a month
D. Monthly
E. More than a month

6. How long is the period, since you established relationship with the bank?
A. Less than 1 year
B. 1- 5 years
C. 6-10 years
D. 10-15 years
E. More than 15yrs

7. What is your monthly salary income?

A. under RM1,000
B. RM1,000 - RM2000
C. RM2001 - RM4000
D. RM4001 - RM8,000
E. Over RM8,000

28
Section 2

Rating Scale
No. Variable Strongly Agree Neutral Disagree Strongly
Agree Disagree
5 4 3 2 1
Customer satisfaction
1 I am satisfied with the
decision to choose this bank
(Affin Bank)
2 This bank (Affin Bank) leaves
me a pleasant impression.
3 I want return to this bank
(Affin Bank) in the future

4 I will advise about this bank

(Affin Bank) to my friends

Customer loyalty
5 I regularly visit this Bank
(Affin Bank).
6 I seldom think of changing
this bank (Affin Bank) to
another one.
7 I use this Bank (Affin Bank)
each time I need to make any
financial transaction.
8 I consider this bank (Affin
Bank) as my preferred choice
each time I want to make any
financial transaction, this
bank (Affin Bank) in my first
choice.
Trust
9 This bank (Affin Bank) keeps
my information confidential.
10 This bank (Affin Bank) is
honest.

29
11 This bank (Affin Bank) is
reliable.

12 This bank (Affin Bank) meets

my needs.

Service Quality
13 Continuous and ordered
functionally of equipment
such as computer and printer
for example the bank (Affin
Bank) has up-to-date
equipment and technology
(buildings,chairs,table,parkin
g areas and other).
14 Staff takes interest on solving
problem which is staff Affin
Bank delivers promise in
timely manner and the
employees sympathetic to
solving problem customer.
15 Ease of depositing and
withdrawing money from any
branch for example Affin
Bank branch perform service
right the first time.
16 Affin Bank maintains error
free records for example
Affin Bank branch charges
reasonable fee for the
administration of the account.
17 Information provided by
Affin Bank employee are
clear and understandable for
example Affin Bank branch
have kno9wledge to answer
customer’s questions.

30
31