Relationship quality and customer loyalty in the Tanzanian microfinance sector

Tegambwage, Amani Gration; Kasoga, Pendo Shukrani

doi:10.1057/s41264-022-00191-8

Cited by 14 publications

(21 citation statements)

References 81 publications

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“…In the context of IB, loyal customers continue using the same banking services now and later, and they are not easily swayed by the marketing efforts of competitors’ financial institutions (Muflih, 2021). Indeed, loyalty represents an important basis for developing a sustainable competitive advantage (Tegambwage and Kasoga, 2022c). Because of the stiff competition in the banking industry, loyalty has been a major concern for IB operators (Wu et al , 2019).…”

Section: Literature Reviewmentioning

confidence: 99%

“…Previous studies have identified RQ (Tegambwage and Kasoga, 2022a,c), SQ (Afifah and Kurniawati, 2021; Sunaryo et al , 2020; Tegambwage and Kasoga, 2022a) and CS (Afifah and Kurniawati, 2021; Rahayu et al , 2020; Sunaryo et al , 2020) as the most important antecedents of customer loyalty. However, as mentioned earlier, the moderation effects of religiosity in the relationship between these factors and loyalty are unclear.…”

Section: Literature Reviewmentioning

confidence: 99%

“…Accordingly, this study considers RQ as a higher-order construct composed of trust, satisfaction and commitment. These three components have also been referred to as the building blocks of RQ (Tegambwage and Kasoga, 2022b,c). However, the application of these components should observe contextual differences.…”

Section: Literature Reviewmentioning

confidence: 99%

“…Although RQ does not have a widely accepted definition and measure, there is some agreement in describing it as the overall strength of a relationship and the extent to which it meets the needs and expectations of the parties (Tegambwage and Kasoga, 2022c). Even though there is no agreement among researchers as to what dimensions make up RQ, many researchers have used a combination of three primary dimensions, namely, trust, satisfaction and commitment (Tegambwage and Kasoga, 2022b).…”

Section: Relationship Qualitymentioning

confidence: 99%

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Determinants of customer loyalty in Islamic banking: the role of religiosity

Tegambwage

Kasoga

2023

JIMA

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Purpose The purpose of this study is to investigate the moderation effects of religiosity in the relationship between service quality (SQ), customer satisfaction (CS), relationship quality (RQ) and Islamic banking (IB) loyalty in a non-Islamic country. Design/methodology/approach This study used a quantitative approach and a cross-sectional research design. The data was collected by a closed-ended questionnaire from a systematic sample of 267 customers of full-fledged Islamic banks in Tanzania. Structural equation modeling and regression analysis techniques were used to analyze the data. Findings Results indicate that religiosity is a significant (p < 0.05) moderator of the relationship between SQ and loyalty (β = 0.176), and between CS and loyalty (β = 0.263). However, religiosity sharpens the impact of CS on loyalty (β increases from 0.170 to 0.263, p < 0.05) and does not sharpen the impact of SQ on loyalty (β decreases from 0.338 to 0.176, p < 0.05). The results further indicate that religiosity is not a significant moderator (p > 0.05) in the link between RQ and loyalty (β = −0.112). Research limitations/implications This study used only full-fledged Islamic banks in Tanzania. Therefore, future research could be undertaken by including conventional banks that have introduced an IB window. Practical implications To build and maintain a loyal customer base, Islamic banks should take advantage of religiosity by providing a wide range of Sharia-based products and services that truly distinguish them from conventional banks. Accordingly, policymakers should establish an appropriate legal framework to enable Islamic banks to leverage religiosity to sharpen the impact of CS on loyalty and hence maintain loyalty in non-Islamic countries like Tanzania. Originality/value This study proposes and validates the theoretical model of loyalty in IB by showing the role of religiosity as a moderator in a non-Islamic country. This knowledge strengthens the overall understanding of loyalty in IB. To the best of the authors’ knowledge, this study is the first to examine the moderation effects of religiosity in the link between RQ and loyalty, and thus between SQ, CS, RQ and loyalty in a single study.

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Section: Literature Reviewmentioning

confidence: 99%

Section: Literature Reviewmentioning

confidence: 99%

Section: Literature Reviewmentioning

confidence: 99%

Section: Relationship Qualitymentioning

confidence: 99%

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Determinants of customer loyalty in Islamic banking: the role of religiosity

Tegambwage

Kasoga

2023

JIMA

Self Cite

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“…Notable studies include Agyei-Boapeah et al (2020), Churchill (2000), Dzingirai et al (2021), Gutiérrez-Nieto and Serrano-Cinca (2009), Kanyurhi (2017), Rokhman and Abduh (2020), and Rokhman and Rivai (2014), among others. These studies have analyzed client's loyalty in microfinance by utilizing cross-sectional/primary data (Achmad & Solekah, 2021;Dzingirai et al, 2021;Prass & Sumadi, 2020;Rokhman & Abduh, 2020;Tegambwage & Kasoga, 2022), with loyalty typically assessed based on customer perceptions using a Likert scale. 2 However, to our knowledge, none of these existing studies have investigated customer loyalty in MFIs using firm-level data.…”

Section: Introductionmentioning

confidence: 99%

Loyalty of rural microfinance borrowers: International evidence

Mia

2023

Bulletin of Econ Res

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The growth and financial sustainability of a firm is tied to its ability to retain existing and potential clients. On the contrary, the defection of customers has a huge implication on firms including microfinance institutions (MFIs), suggesting that the attainment of customer loyalty is an important strategy for MFIs to improve their performance. Hence, this study attempts to investigate the level of loyalty demonstrated by rural microfinance borrowers toward their respective service providers. To accomplish this, an unbalanced panel data, comprising 1101 unique MFIs and spanning the timeframe 2010–2018, were obtained from the World Bank database and thereafter subjected to conventional econometric techniques and a series of robustness tests, including endogeneity‐corrected methods, alternative proxies, and sub‐sample analyses. The findings indicate that rural microfinance borrowers generally demonstrate loyalty to their service providers, particularly when measured by borrower retention rates; however, these findings vary with the adopted techniques, sub‐samples, and proxies employed during the analysis.

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The Effect of Attitudes Towards Money on Over-Indebtedness Among Microfinance Institutions’ Customers in Tanzania

Kasoga,

Tegambwage

2024

Applied Research Quality Life

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Relationship quality and customer loyalty in the Tanzanian microfinance sector

Cited by 14 publications

References 81 publications

Determinants of customer loyalty in Islamic banking: the role of religiosity

Determinants of customer loyalty in Islamic banking: the role of religiosity

Loyalty of rural microfinance borrowers: International evidence

The Effect of Attitudes Towards Money on Over-Indebtedness Among Microfinance Institutions’ Customers in Tanzania

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