Abstract:
Customer satisfaction is one of the critical factors to build a competitive advantage, particularly
in emerging markets such as Sri Lanka. The study quantitatively examines the influence of vital
service quality dimensions-staff friendliness, ease of use online or mobile banking, ATM functionality,
fee transparency, and service speed-on customer satisfaction with public, private, and
foreign banks. A structured questionnaire was administered to 96 banking customers, and data
were analysed using descriptive statistics, Pearson’s correlation, one-way analysis of variance
(ANOVA), and multiple linear regression. The descriptive statistics revealed ATM functionality
as the most satisfactory attribute, whereas fee transparency was the least satisfactory. Pearson
correlation reflected strong positive relations between overall customer satisfaction and the
service speed (r = .83, p < .001), ease of digital banking (r = .77, p < .001), and staff friendliness
(r = .74, p < .001). One-way ANOVA did not reveal a difference in satisfaction across
banks (F(2, 93) = 1.26, p = .288). Yet, foreign banks again displayed higher mean satisfaction
scores in small subsample tests. Multiple linear regression analyses revealed that service speed
(β = .37), ease of online/mobile banking (β = .37), and staff friendliness (β = .22) predicted
overall satisfaction (R = .82, p < .001)while ATM functioning and fee transparency could not
predict average satisfaction after controlling for other independent variables. Results show the
predictors to be fairly independent (VIF < 5). Qualitative thematic analysis further took into
account concerns about fee transparency and digital usability. Hence, responsiveness of service,
quality of digital platforms, and the engagement of staff seem to be vital factors influencing customer
satisfaction in the growing banking sector of Sri Lanka. From a strategic point of view,
more emphasis must be laid on the promotion of digital banking services, improvement of interactions
between staff and customers, and transparency to carve out a sustainable competitive
advantage. Future studies should present larger and more representative samples with sophisticated
statistical modelling that can come up with complexities in service quality.
