The impact of service quality on the competitiveness of retail banking service in Vietnam

Abstract

This study aims to measure the impact of service quality factors on the retail banking competitive-ness of commercial banks from the customer perspective. The initial hypothesis is that there are 5 service quality components affecting the competitiveness of retail banking services including: reliability, tangibility factors, assurance, responsiveness and empathy. The research data was collected through a sur-vey of 346 individual customers who had been using banking services in Vietnam. Descriptive statistical methods, exploratory factor analysis (CFA), factor confirmation analysis (EFA) and structural equation modeling (SEM) are used in the study. The results show that the factors that have the strongest impact on the competitiveness of retail banking services are: reliability and assurance, responsiveness, and tangibility. The empathy factor does not have a positive impact on the competitiveness of retail banking services. From these resulfs, discussions and some policy implications have been made to improve the retail banking com-petitiveness of Vietnamese commercial banks.