Impact of customer satisfaction on commercial banks in Nepal: Insights from a survey-based study

Abstract

This study investigates how various service quality dimensions affect customer satisfaction in commercial banks across Nepal. The objective of this study is to examine the impact of key service quality dimensions (responsiveness, empathy, assurance, communication, and overall service quality) on customer satisfaction in commercial banks in Nepal. A survey-based quantitative approach was employed, collecting data from 399 customers in Nepal. The study utilizes multiple linear regression analysis and hypothesis testing to determine the relationship between these factors and customer satisfaction. The results indicate that communication, assurance, and service quality positively influence customer satisfaction, with a moderate mean score of 2.317949 out of 5 and moderate variability (SD = 0.479612). These three factors are key contributors, accounting for 41.5% of the variation in satisfaction, whereas empathy and responsiveness have weaker or insignificant impacts. The study concludes that enhancing communication and service quality is crucial for improving customer satisfaction, which is essential for sustainable growth in Nepal’s financial sector.