Internet Banking And Customer Satisfaction In Commercial Banks In Uganda: A Case Study Of Tropical Bank Limited, Kansanga Branch, Kamp Ala, Uganda.

Abstract

The study was about Internet Banking and Customer Satisfaction of Tropical Bank Limited, Kansanga Branch, Kampala, Uganda. The study was based on the following three objectives; to examine the effect of ATMs on customer loyalty; To determine the effect of

A TMs on customer retention and to establish the relationship between internet banking and customer satisfaction of Tropical bank limited, Kansanga branch, Kampala, Uganda. A sample of 80 respondents both female and male customers of the bank were used for the study. The study employed descriptive research and exploratory research design and methodology used was both qualitative and quantitative. Questionnaires and documentary review were the major tools of data collection.

It was found out that Automatic Teller Machine as a construct of internet banking was rated high and this was indicated by the average mean of 4.18, implying that customers of Tropical Bank Ltd, Kansanga Branch often use internet banking. It was revealed that customers often; check their account balance using A TM, withdraw money from their accounts using A TM any time they want, make saving to their accounts using ATM and get bank statement using ATM.

It was revealed that Automatic Teller Machine highly affects customer loyalty which was

rated at average mean of 3.53, this was fi.uiher revealed customers; intend to stay with the bank because of A TM services, are glad to recommend bank to their friends, make an effort to use bank for all their banking needs and will not keep on using the bank as long as it offers the best interest rates for them. Also A TMs as a construct of internet banking on average, moderately affects customer retention and this was indicated by average mean of 3.37, it was revealed that customers have no confidence that the bank provides the best internet banking services, customers find it necessary to be cautious in dealing with the bank, customers have

little confidence of staying with the bank, bank can be relied upon to keep customers' promises, customers trust the bank and cannot leave it.The study revealed a perfect weak linear correlation whereby internet banking weakly affects customer satisfaction of Tropical bank limited, Kansanga branch, Kampala, Uganda. It was recommended that the management of the bank should acquire most recent sophisticated friendly ATM machine; enhance

operational efficiency and quality of service to attain and retain customers; reduce charges on the users of ATM services so as to encourage the customer to continue patronize the ATM services.

TABLE OF CONTENTS

Declaration .......................................................................................................... i

Approval ......................................................................................................... ii

Dedication .......................................................................................................... iii

Acknowledgement ................................................................................................................ iv

TABLE OF CONTENTS ....................................................................................................... v

List of Tables ........................................................................................................ ix

List of Acronyms ................................................................................................................... x

Abstract ........................................................................................................... xi

CHAPTERONE .................................................................................................... 12

INTRODUCTION ............................................................................................................... 12

1.0 Introduction ...................................................................................................... 12

1.1 Background of the study ................................................................................................ 12

1.3 Purpose of the study ....................................................................................................... 15

1.4 Research objectives ........................................................................................................ 16

1.5 Research questions ......................................................................................................... 16

1.6 Scope of the Study ......................................................................................................... 16

1.6.1 Geographical scope ..................................................................................................... 16

1.6.2 Subject scope .............................................................................................................. 16

1.6.3 Time scope ....................................................................................................... 16

1. 7 Significance of the Study ............................................................................................... 17

CHAPTER TWO ........................................................................................................ 18

LITERATURE REVIEW .................................................................................................... 18

2.0 Introduction ...................................................................................................... 18

2.1 Conceptual definitions ................................................................................................... 18

2.1.1 Internet banking .......................................................................................................... 18

2.1.2 Customer satisfaction .................................................................................................. 18

2.2 Customer loyalty ............................................................................................................ 19

2.3 Customer retention ......................................................................................................... 20

2.4 Relationship between A TM and customer satisfaction ................................................. 21

CHAPTER THREE ........................................................................................................... 24

METHODOLOGY .............................................................................................................. 24

3.0 Introduction ......................................................................................................... 24

3.1 Research design ............................................................................................................. 24

3 .2 Target population ........................................................................................................... 24

3.3 Sample size ....................................................................................................... 24

3.4. Sampling techniques ..................................................................................................... 25

3.5. Data sources ....................................................................................................... 25

3 .5 .1 Primary data ................................................................................................................ 25

3.5.2 Secondary data ............................................................................................................ 25

3.6 Data collection instruments ............................................................................................ 25

3.6.1 Questionnaires ............................................................................................................. 25

3.7. Data analysis and presentation ...................................................................................... 26

3.7.l Data editing ......................................................................................................... 26

3. 7 .2 Data coding ........................................................................................................ 26

3. 7.3 Data analysis ............................................................................................................... 26

3.7.4 Data presentation ........................................................................................................ 26

3.8 Ethical consideration ...................................................................................................... 26

3.9 Limitations of the study ................................................................................................. 27

CHAPTER FOUR ................................................................................................................ 28

PRESENTATION, INTERPRETATION AND ANALYSIS OF FINDINGS .................... 28

4.0 Introduction ........................................................................................................ 28

4.1 Bio data of respondents .................................................................................................. 28

4.1.1 Age groups of respondents .......................................................................................... 28

4.1.2 Gender of respondents ................................................................................................ 29

4.1.3 Highest Level of education ofrespondents ................................................................. 29

4.2 Automatic Teller Machine of Tropical Bank Ltd, Kansanga Branch, Kampala, Uganda

······································································································30

4.3 Effect of ATMs on Customer Loyalty of Tropical Bank Limited, Kansanga branch,

Kampala, Uganda ........................................................................................................ 31

4.4 Effect of A TMs on Customer Retention of Tropical Bank Limited, Kansanga branch,

Kampala, Uganda ........................................................................................................ 32

4.5 Relationship between internet banking and customer satisfaction of Tropical Bank

Limited, Kansanga Branch, Kampala, Uganda .................................................................... 33

CHAPTER FIVE ........................................................................................................ 34

SUMMARY OF FINDINGS, CONCLUSIONS AND RECOMMEND A TIO NS .............. 34

5.0 Introduction ...................................................................................................... 34

5.1 Summary of findings ...................................................................................................... 34

5.1.1 Automatic Teller Machine of Tropical Bank Ltd, Kansanga Branch, Kampala,

Uganda ...................................................................................................... 34

5.1.2 Effect of ATMs on Customer Loyalty of Tropical Bank Limited, Kansanga branch,

Kampala, Uganda ...................................................................................................... 34

5.1.3 Effect of ATMs on Customer Retention of Tropical Bank Limited, Kansanga branch,

Kampala, Uganda .................................................................................................... 35

5.1.3 Relationship between internet banking and customer satisfaction of Tropical bank

limited, Kansanga branch, Kampala, Uganda ...................................................................... 35

5.2 Conclusions of the study ................................................................................................ 35