The Effect of Electronic Banking Service Qualities on Customer Satisfaction: The Case of Commercial Bank of Ethiopia

Abstract

This study investigates the effect of electronic banking service quality dimensions on customer satisfaction at Commercial Bank of Ethiopia's Kirkos District and selected branches, employing a quantitative research approach and descriptive and explanatory research design with a sample of 364 active e-banking users. The analysis reveals statistically significant positive relationships between customer satisfaction and four key service quality dimensions: privacy and security (β = 0.454, p < 0.001; r = 0.919), reliability (β = 0.249, p < 0.001; r = 0.810), system availability (β = 0.199, p < 0.001; r = 0.855), and customer service support (β = 0.154, p < 0.001; r = 0.785). Notably, privacy and security emerged as the strongest predictor, accounting for the highest variance in customer satisfaction. The regression model demonstrated strong explanatory power, with an R² of 0.927 indicating that 92.7% of variation in customer satisfaction can be attributed to these service quality dimensions. Contrary to expectations, responsiveness (β = -0.036, p = 0.129) and transaction efficiency (β = 0.058, p = 0.050) showed no statistically significant impact. These findings suggest that CBE should strategically prioritize enhancing security measures, ensuring system reliability, and maintaining consistent service availability to optimize customer satisfaction. The study provides empirical evidence for service quality improvement in Ethiopia's banking sector while identifying areas for future research, particularly regarding the contextual factors influencing the non-significant dimensions.