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Customers’ expectation in the post-consolidation era of the Nigerian banking sector is very high. This is justified by the belief that the exercise had crowded out incompetent banks and left only those ones which are able to compete in both domestic and global marketplace. However, in recent times, most Nigerian banks have fallen short of this expectation. Customers have experienced challenges ranging from delay transaction notification, stock out, non-availability of staff at service points, unprofessional conduct or rude behaviours by the staff of the banks, poor standard of records or improper information, failed promises among others. Ogunnaike and Ogbari (2008) opined that customer service in Nigerian banking industry can be mistaken to mean customer delay and frustration. Almost every Nigerian bank encounters similar problem in meeting customers’ expectation of services and customer satisfaction. For instance, the issue of delay in posting transactions such as money transfer and payments made between customers is a major problem that customers of Nigerian banks have been made to experience. In most cases, the customer hardly receives the notification that an account has been credited or debited immediately. The account holder may have to wait endlessly before seeing the notification or in worse cases, may have to visit the bank to confirm such transaction.

Also, the long queues and huge crowds in the banking halls can be highly devastating and discouraging, especially when the weekend is near. Most times, these long queues are as a result of the breakdown of the networks on the computers used for operation. Sometimes, it occurs as a result of the cash officers pushing duties to one another, as to who is to attend to the customer or not. Consequently, there is a problem of customer loyalty and profitability of the bank. One of the major requirements for banks’ efficiency is to match their service facilities with the needs of customers without much delay. However, the common experience in Nigeria is that most banks do not have the facilities and capacities to service the number of customers without too much delay on the part of the customers. This situation has led to poor efficiency in banking service delivery in Nigeria and has thus caused low customer satisfaction. Many Nigerian banking public has thus wondered when the endless desires of spending the least possible time for banking transactions will be met by banks in the country. Although one of the strong objectives of banks is want to attract, retain customers and at the same time optimize profit, however, profit maximization in banking industry is a function of the management’s ability to provide efficient services to customers at little or no time wastage (Agbadudu, 1995).

A work done by Curuana (2000) goes a long way to support the idea that service quality, customer satisfaction and customer loyalty are undoubtedly linked. Curuana (2000) developed a mediational model that linked the service quality and service loyalty via customer satisfaction and applied the model in a research in the retail banks in Malta. The results of the research appeared to prove the links between service quality, customer satisfaction and customer loyalty. Gathering from various works done on quality of service, the conclusion drawn by Boateng (1995) is that an improved service quality has the ultimate goal of achieving overall increased productivity, increased financial performance and increased profitability which emanates from the following derived advantages; enhanced customer retention rates and higher customer loyalty; attraction of new customers from word of mouth recommendation; lower advertising and promotions cost; a higher market share; improved employee morale as they belong to the winning team; insulation from price competition; and potential cost leadership arising from lower staff turnover, lower cost of training, lower administrative costs and reduced complaints from customers. The above mentioned are the importance of providing quality customer service and underscores why ensuring quality customer service has become the competitive power in today’s business world. In the service industry the need for quality is even more pronounced because of the peculiar distinguishing features of service from products.

Among the numerous definitions given for service, Kotler (2000) has defined service as any act, performance or experience that one party can offer to another. According to Lovelock and Wirtz, (2004), “Services are economic activities that provide time, place, form utility, problem-solving while bringing about a change in, or for, the recipient of the service.” Services possess the characteristics of perishability, intangibility, inseparability and heterogeneity. Services deliver the intangible value like knowledge, utility or care, and convenience to the party who needs it. Due to the service nature of the banking industry it is easy for one bank to copy new products and new innovations from another bank. This has caused the competition among the banks in the Nigerian industry to be fierce with each one trying to out-do the other in order to maintain its market share or capture the market of its competitors. Bank executives and continuously cited to be formulating and preaching about policies that will ensure high customer quality standards in their banks.

1.2          Statement of the Problem

In the Nigerian banking industry, high customer satisfaction is hypothesized to be linked to high firm performance. Bankers consider customer satisfaction and loyalty as important to market share maintenance and profitability. As products and prices have become less important differentiators; the importance of service quality can no longer be overlooked and taken for granted (Ward & Tracey S. Dagger, 2007). It has thus become very necessary to find out how banks in Nigeria particularly, achieve customer satisfaction in the face of increased competition through service quality. Notwithstanding the existence of fierce competition in the banking industry in Nigeria and high customer churn, the debate as to what drives customer satisfaction is still rife, this is due to the fact that, complaints of poor service quality is on the increase. Could it be that there is a general misconception and poor attitude towards the concept of service quality and Customer Satisfaction? Hinson and Mensah, (2006) contends, in a competitive era, customer switching to other service providers is high especially when customers are dissatisfied with service provided. Thus customer defection due to dissatisfaction is a curious research subject to investigate. Since Service Quality is touted as the bedrock of every successful organization, its practice needs to be examined and measured. However, it appears no or little studies have sought to ascertain how service quality practices could lead to customer satisfaction in banks within Nigeria.

1.3          Objectives of the Study

The study sought to assess the effect of bank service delivery on customer satisfaction in Nigeria. Specifically, the study sought to;

  1. examine the influence of poor bank service delivery on customer satisfaction in the Nigerian banks.
  2. identify factors that may cause customer dissatisfaction in the Nigerian banks.

iii.   examine whether staff strength affect service delivery in the banking industry.

1.4          Research Questions

  1. What is the influence of poor bank service delivery on customers’ satisfaction in the Nigerian banks?
  2. What are the factors that may cause customer dissatisfaction in the Nigerian banks?

iii.   Does staff strength affect service delivery in the banking industry.

1.5          Research Hypotheses

Ho1:  Poor bank service delivery does not influence customer satisfaction in the Nigerian banks.

Ho2: Staff strength does not affect service delivery in the banking industry.

1.6          Significance of the Study

This study will be of immense benefit to other researchers who intend to know more on this study and can also be used by non-researchers to build more on their research work. This study contributes to knowledge and could serve as a guide for other study.

1.7      Scope/Limitations of the Study

This study is on the effect of bank service delivery on customers’ satisfaction in Nigerian banks.

Limitations of study

Financial constraint: Insufficient fund tends to impede the efficiency of the researcher in sourcing for the relevant materials, literature or information and in the process of data collection (internet, questionnaire and interview).

Time constraint: The researcher will simultaneously engage in this study with other academic work. This consequently will cut down on the time devoted for the research work.

1.8          Definition of Terms

Bank: A bank is a financial institution that accepts deposits from the public and creates credit.

Service delivery: is a component of business that defines the interaction between providers and clients where the provider offers a service, whether that be information or a task, and the client either finds value or loses value as a result.             

Customer satisfaction: is a term frequently used in marketing. It is a measure of how products and services supplied by a company meet or surpass customer expectation.


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