FACTORS AFFECTING CUSTOMER RETENTION IN NEPALESE COMMERCIAL BANKS
Date
2024
Authors
Journal Title
Journal ISSN
Volume Title
Publisher
Shanker Dev Campus
Abstract
The study explores the factors influencing customer retention in Nepalese commercial
banks, focusing on perceived service value, employee behavior, complaint handling,
customer convenience, switching barriers, and customer satisfaction. Correlation analysis
reveals significant positive relationship between customer retention and factors like
perceived service value (r = 0.522), employee behavior (r = 0.495), complaint handling (r
= 0.492), customer convenience (r = 0.587), and customer satisfaction (r = 0.793).
However, no significant relationship is found between switching barriers and customer
retention (r = 0.036, p = 0.660). The regression analysis, with an adjusted R-squared
value of 0.653, indicates that 65.3% of the variation in customer retention is explained by
the independent variables, while 34.7% is attributed to other factors like marketing,
pricing, and customer interactions. ANOVA confirms the model's appropriateness, and
behavior of employees (p
= 0.018) and customer satisfaction (p = 0.000) emerge as the most significant predictors
of customer retention. The findings underscore the critical role of service quality,
employee engagement, and customer satisfaction in fostering customer loyalty in
Nepalese commercial banks.