Luận văn thạc sĩ Quản trị kinh doanh: Customers’satisfaction on the retail banking services of Joint Stock Commercial Bank for Investment and Development of Viet Nam - Transaction 1 Branch

In addition, the government's policy of encouraging non-cash consumption reducing the rate of using cash to less than 10 percent of the total means of payment is also one of driving forc

Không Thị Quỳnh TrangĐẠI HỌC QUOC GIA HÀ NỘI

KHOA QUAN TRI VÀ KINH DOANH

KHỎNG THỊ QUỲNH TRANG

CUSTOMERS 'SATISFACTION ON THE RETAIL BANKING

SERVICES OF JOINT STOCK COMMERCIAL BANK FOR

INVESTMENT AND DEVELOPMENT OF VIET NAM

-TRANSACTION 1 BRANCH

SU HAI LONG CUA KHACH HANG DOI VOI DICH VU NGAN

HANG BAN LE TAI NGAN HANG THUONG MAI CO PHAN DAU

TU VA PHÁT TRIEN VIET NAM - CHI NHANH SO GIAO DỊCH 1

HÀ NOI - 2021

ĐẠI HỌC QUOC GIA HÀ NỘI KHOA QUAN TRI VÀ KINH DOANH

KHONG THI QUYNH TRANG

CUSTOMERS 'SATISFACTION ON THE RETAIL BANKING

SERVICES OF JOINT STOCK COMMERCIAL BANK FOR

INVESTMENT AND DEVELOPMENT OF VIET NAM

-TRANSACTION 1 BRANCH

SU HAI LONG CUA KHACH HANG DOI VOI DICH VU NGAN

Chuyén nganh: Quan tri kinh doanh

Mã số: 8340101.01

LUẬN VĂN THẠC SĨ QUAN TRI KINH DOANH

NGƯỜI HƯỚNG DẪN KHOA HỌC: TS NGUYÊN QUỲNH HUY

HÀ NỘI - 2021

STATEMENT OF AUTHORSHIP

The author confirms that this thesis is the result of her independent work Thedata and information used in the thesis are true with a clear origin The solutionsand recommendations are proposed based on the author’s practical research andpersonal working experience at the Joint Stock Commercial Bank for Investmentand Development of Vietnam — Transaction 1 Branch

I would like to express my deepest gratitude to all of the following people forhelping me complete my thesis

Firstly, I would like to express my special thanks to The Board of Directors of

the Retail Banking Development Division for giving favorable conditions for mystudy and my master thesis completion at Hanoi School of Business and

Management, Hanoi National University

Secondly, I am extremely grateful to all of the lecturers from the School of

Business and Management (HSB) for providing me with research methods and

professional knowledge during the course, especially the active and creative researchskills

My appreciation also goes to the teachers in the thesis review committee forgiving me valuable ideas during my thesis completion process

My profound gratitude is also conveyed to my instructors Dr Nguyen Thi KimOanh and Dr Nguyen Quynh Huy for their helpful assistance and guidance This thesis

could have never been completed without their enthusiastic counsel and support

Despite the efforts during the research period, there are still many limitations

in the thesis I would hope to receive valuable comments from the teachers and workers to make this essay more complete

co-Thank you very much./

Ha Noi, 03/12/2020

Khong Quynh Trang

TABLE OF CONTENTSABBREVIA TÍỌNS 5-5 5c 0 9¬ 0 0 0 0 0 0000000000009000504009040.0090009090909 iLIST OF “TA BLLEVS o<5-5< 5< << ử H H h0 05040040000.090.008900000.00000 00 iiLIST OF EIGURE < << 5< s2 H 9 0000000 00090505004.904.09090909090909ø iiiINTRODUCTION 5-5 5< 4 H0 0.0 00500800805 05000890900904.0 0898.0984040 1

1 Relevance of the researCHh - 5 x91 TH ng ng nh nkt 1

6 Overview of previous studies related to the research ‹«++s«s+«<x++ 5

7 Structure of the th€SIS - 0 G190 nh nh nh nh nh nh 7CHAPTER 1 THEORETICAL FRAMEWORK ON CUSTOMERSATISFACTION ON RETAIL BANKING SERVICES AT -<e<eseseseseses 8COMMERCIAL BAN K 5 << HH 0 0 0 0 00000000000 0606050400400000006 8

1.1 Overview of retail banking services of commercial banks - «- 8

1.1.1 The concept of retail DANKING ccccccccccccescesseeseseseessesseeeeseesseeseneseasenseeeeaeenes &1.1.2 Characteristics of retail DAHKÏH ác viet 91.1.3 Main retail banKing S€TVÏC€S SG kh HH vn key IlI0) (00 don n6 15

1.2.1 Definition of CUStOMET SGflSƒ((CÍÍOHH - 5 s1 ky 15

1.2.2 The relationship between customer satisfaction and service quality 16

1.2.3 ASSESSING CUSTOMEL SATISPACTION ccceseccesecescceeetenecesceenseceseceneeeeseseaeeeseeenas 17

1.3 Experience to improve customer satisfaction on retail banking services 24

1.3.1, Experience of Vietinbank Ha Thanh branch 55-5 << s<+ss++sx2 241.3.2 Experience of Vietcombank Ha Thanh Branch -s «<< s<+ss++ 251.3.3 Lessons learned for BIDV SŒÏ cv kikkeeeekseeeeeeeeeree 27CHAPTER 2 RESEARCH METHODOLOOY 5-5555 ssesesessssssesesesee 28

VN ai 28

2.2 Research metho( - - + 2 2231111118111E1 1111 2555511111 kg ke 30

2.2.1 Preliminary T€S€@TFCÌH c- sp 30

2.2.2 QUANTITATIVE TESCATCH nan n6 eeee 31

CHAPTER 3 EMPIRICAL RESULTS s.5-5 5-5-5555 S5 S5 S9 9995995556856 56 36

3.1 Overview of BIDV- Transaction 1 Branchh - « s«++s£+sxe+sseesseessee 36

3.1.1 History and D@V€ÏOJDDITI€HIỂ G5 11v kiện 363.1.2 Business perfOrMance T€SHÏHS SG St nghiệt 36

3.2 Retail banking services at BIDV SƠD]T Gv niệt 38

3.2.1 BIDV SGDI portfolio of retail DaHKỈHg ss- <ssss sksskksseesseke 36

3.2.2 Distribution channel providing retail banking $erViC€S ««<-«<- 4]

3.2.3 Retail banking business results c.cccccccsccccsccceessecesseeceeseeeeseeseuseeeeseeeseneeeees 433.3 Customer satisfaction survey results at BIDV SGDI - «-<<c+sxe2 46

3.3.1 Sample description SÍQflSÍÍCS Gv kg Hiệp 463.3.2 Verify the reliability of the SC@Ï© cc- c Ship 493.3.3 Results of exploratory factor analysis (EFA) cccccccccccsccceesetseseceestesessseeees 53

3.3.4 Results Of regression IQÏSÌS SG SH nhiệt 56

3.3.5 Results of the model suitability test cccccccccccccesscccesssceeseeeesseessseeesseeeesseeenes 583.3.6 The test results on the violation of the necessary assumptions in the

PE QTESSTON IHOCÌ©Ï, G0110 HH HH ke 59

3.3.7 Results of customer surVey ON CACH ƒQCÍOF ằ S555 E+sekEseesseeerke 613.4 Evaluate customer satisfaction with retail banking services at BIDV SGD1 72CONCLUSIONS AND RECOMMENDED SOLUTIONS FOR IMPROVING THELEVEL OF CUSTOMER SATISFACTION ON THE RETAIL BANKING OF

JOINT STOCK COMMERCIAL BANK FOR’ INVESTMENT AND

DEVELOPMENT OF VIET NAM - TRANSACTION 1 BRANCH 75

2.4 Solutions 02a an 79

2.9 Solution for "reliqbiÏifW” c cv HH nhiệt G1

3 RecommendtiOIS - 5G s19 v9 ng nh nh ng 81

3.1 Recommendations to the ŒOV€THIN€HI 5 «5s seesses 81

3.2 Recommendations to the State B@QHĂ - se kEsskksseke 8&2

3.3 Recommendations to BÌD cv, 8&3REEERENCESS 5-5 5< 0 0 0.0 000000000000 0000 050500040000.008909890900000 000 85

APPENDIX I: SERVICE QUALITY QUESTIONNAIRE SURVEY - 1APPENDIX 2: DATA ANALYSIS RESULTS

Joint-stock commercial Bank for Investment and Development

of Vietnam - Transaction 1 BranchService quality model

Service quality model implementation

Point-of-sales, an electronic device supporting card payment

Automatic Teller Machine

LIST OF TABLES

Table 2.1 Summary of interview results on customer satisfaction with retail banking

Da 4.344 31Table 2.2 Encrypting Survey Data SUTV€V HH HH ngư 32

Table 3.1 Results of business operations of BIDV SGD1 -<c<<<<<<2 37

Table 3.2 List of retail mobilization and credit S€rvice eee eeeeeeeseeeeeeteeeseeeeeeeees 38Table 3.2 Group of e-banking services and Other- - s5 s++ss*++stssexeeerese 40Table 3.4 The bank's distribution channels - 5 «6 + + S31 Evskeeskrreersre 42

Table 3.5 Some main retail targets eee 5 + 2E 1 93111 E31 E1 E31 11 1 TH nh ng 43

Table 3.6 Net income from retail banking services of BIDV SGD1 44

Table 3.7 Number of customers using BIDV's SGD1 retail banking services 45Table 3.8 Gender 1n the SUIVCY cece cece 5G 221111931 E11 3 1 TH TH HH nhớt 46

Table 3.9 Age in 2,201 .4.4 47Table 3.10 Education in the SUrVey - G2 0113118911131 8 11191191 ng ngư 47

Table 3.11 Occupation in the SUTVV 5 + SE vn TH ng ng nghiệt 48Table 3.12.Income in the SUTV€Y - (G0 11H HH TH ng 48

Table 3.13 Scale measurement result SUMMATY - 5 555 3+ kE+eeeeeeersseess 49

Table 3.14 The results of exploratory factor analysis (EFA) with independent variables 54

Table 3.15 The results of exploratory factor analysis (EFA) with the dependent variable 55Table 3.16 Results of correlation analysis among the variables in the model 56Table 3.17 Descriptive Statistics ceccesccsssecsseceseeesseceseceseeseaeceseeeseeseaeeeeeseaeseaeeesees 56Table 3.18 Results of regression ađaÏYS1S - - c1 ng ng ng ngư 57

Table 3.19 Analysis of variance (ANOVÀ) LH LH HH ng HH kg 59

Table 3.20 Survey customers on the reliability ÍaCfO -. 25 + *+++exseeeess 62

Table 3.2 Customer survey on the responsiveness factor 5< Ss<c+<cssc+ 63

Table 3.22 Customer survey on the assurance factor cceeeeceeseeeceseeeceeeeeseereeseees 65Table 3.23 Customer survey on the empathy ÍaCfOT - - 5-55 ++vsseexeeerseeers 67Table 3.24 Customer survey on the tangible factors 5 +55 + *+skseereeeeese 69Table 3.25 Satisfaction of the customers using retail banking SerVICe€S - 7Table 3.26 General assessment of customer satisfaction with BIDV SGDI retailbanking SCLVICES TT 444.- 4d 72

LIST OF FIGURES

Figure 1.1 SERVQUAL model - 6 5 23% 31%951 91 93991 931 1 931g vn nkp 18Figure 1.2 SERVPERF Model - <6 5 + E111 31 1 TH ng nh nh nHnrưệt 20

Figure 1.3 Technical quality model, functional quality - «<< =<<<<<<+ 21

Figure 2.1 Research proposal model adapted from Cronin and Taylor (1992) 23Figure 2.2 Research Process sceessssscssecsecssecsscsseeseesseessseseceesseeseeeseseeesseesaeeseenseens 29

Figure 3.1 Remainder frequency (1aØTA1m .- - - s ++++ 31 E93 E91 EvEssekeekkreseere 60

Figure 3.2 PP frequency Chart - 5 + << 2 E1 E931 E1 E3 E91 E3 E1 1 TH HH nhớt 61

II

1 Relevance of the research

Vietnam's economy is on the rise with 96 million people and golden

population structure (ages 20-44) (General Statistics Office, 2019) However, only

60 percent of the population aged 15 and over has a bank account (BankingAssociation, 2019) The continued increase of the population with middle to highwages is considered a fertile land for retail banking development (Bui Thi Diep,

2019) In addition, the government's policy of encouraging non-cash consumption

(reducing the rate of using cash to less than 10 percent of the total means of

payment) is also one of driving forces for the development of banking services, and

changing consumer habits in the banking sector.’

In addition, the effects of the industrial revolution 4.0 have provided thebanking industry with opportunities to cut administrative costs, improve product

and service quality, increase labor productivity, and develop more new, modern andsecurity products to meet the increasing needs of customers (Pham Thi Thai Ha,

2020) However, Vietnamese banks are also facing a big challenge that is the

increasingly competitive trend Therefore, the improvement of customer satisfaction

is considered as one of the important factors to expand customers and retain loyalcustomers, improving operational efficiency as well as the development of a bank

(Pham Thi Mong Hang, 2019) Hence, studying the quality of services, increasing

customer experience and improving customer satisfaction are increasingly urgent

tasks for banks

Currently, there are many studies that have shown the essential role of

improving customer satisfaction According to Lemon et al (2012) and Bolton

(1998), the more satisfied the customer is with the services served, the more likelythey are to continue to make their purchase Meanwhile, Dawkins and Reicheld(1990) show that customer satisfaction can improve customer retention rate by over

25 percent compared to the average The current Vietnamese banking system is still

' Decision No.2545/QD-TTg dated 30%, Dec,2016

experiencing positive changes, especially in the retail banking sector In fact, thissegment has only been appreciated since 2010 The service quality and variety of

products introduced to customers are not commensurate with the potential (NguyenThi Bup, 2020)

Joint Stock Commercial Bank for Investment and Development of Vietnam

-Transaction | Branch (BIDV SGD1) was established in 1991 in Hanoi BIDVSGD1 has always been one of the leading, largest branches of BIDV (Annual

Report of BIDV, 2019) The main activity of BIDV SGD1 is to provide financialservices to both individuals and economic organizations Since 2014, according to

the guidance of the Head Office, BIDV SGD1 has chosen the retail banking sector

as its top development priority However, the efficiency of retail business at thebank is not high because the bank has not yet grasped the needs and tastes of this

customer group During the operation, the bank has not done a systematic study oncustomer satisfaction improvement Although BIDV SGDI branch conducted a

number of small surveys on customer satisfaction about retail banking services inthe period 2017-2019, it is not clear about the factors to improve customer

satisfaction from services provided by the bank Determining customer satisfaction

and the factors affecting this issue is, therefore, important for BIDV SGDI to

stabilize its market share as well as build a business development strategy As aresult, the author chose the topic: “Customers’satisfaction on the retail bankingservices of Joint Stock Commercial Bank for Investment and Development of Viet

Nam - Transaction 1 Branch "

2 Research objective

The overall objective of the study is to recommend solutions to improve

customer satisfaction on the retail banking services at BIDV SGDI

The specific objectives of the topic include three main goals, that are:

- Systematize the theories related to customer satisfaction to determine thefactors affecting customer satisfaction on the retail banking services

- Evaluate the level and factors affecting customer satisfaction on the retailbanking services at BIDV SGD1

- Propose solutions to improve customer satisfaction on the retail bankingservices at BIDV SGDI.

3 Research questions

- What are the theoretical issues related to customer satisfaction with retailbanking services ?

- What factors affect customer satisfaction with retail banking services?

- What is the current status of retail banking services at BIDV SGD1?

- Which factors have the most impact and the least impact on customersatisfaction with retail banking services?

- What should BIDV SGD1 do to maintain and improve customer satisfaction?

4 Research methodology

4.1 Research process

The author follows the following 4 steps:

Step 2: CollectingStep 1: Identifying data including

research objectives secondary data and

primary data

Figure Reseach process

Source: Model developed by author4.2 Data collection

Study using primary data and secondary data

Primary data is information collected through customer survey byquestionnaire

The author collects primary data through a questionnaire survey designedaccording to the SERVQUAL questionnaire model (Parasuraman et al 1981 and

2005) More than 300 customers of BIDV SGDI have given their opinions on each

question in the questionnaire through the selection of scales of low to high

satisfaction (1 to 5) The content of survey questions has been adjusted by theauthor in accordance with the research topic on retail banking services at BIDV

SGD1 and previous studies

The questionnaires were sent in two ways: (i) sent to the customer's emailextracted from the Account Opening Application; and (ii) sent directly to thecustomer while they were waiting at the BIDV SGD1 transaction counter The data

analysis tool used in this study is SPSS Based on the results of the data analysis

process, the author summarizes the satisfaction level and identifies the factors that

most strongly influence customer satisfaction to make conclusions andrecommendations

Secondary data is compiled from many sources as follows: BIDV SGDI'sreports such as internal reports on retail activities including capital mobilization data,

outstanding loans, service income, product structure retail service, original data isexported from the core system of the bank; Previous articles and studies related to retail

banking The analysis of secondary data are carried out by using statistical methods andSPSS

5 Scope of the study

The research and assessment of customer satisfaction focus on retail bankingservices at BIDV SGD1 and factors affecting this issue In particular, the researchconcentrates on the group of customers using retail credit services and mobilizing

retail capital because two main groups of customers account for the main proportion

1n the customer structure using retail banking services at BIDV SGD1 At the same

time, most customers using the bank's retail fund mobilization service will also use

e-banking because these are the accompanying utilities that the bank provides todepositors

Data collection:

Primary data: Collected from the survey of 337 customers using retail services

at BIDV SGDI

Secondary data: collected from 2017 - 2019 through internal reports of BIDV

SGDI and research documents on the field of customer satisfaction

6 Overview of previous studies related to the research

The author Pham Thi Mong Hang (2019) conducted “Research on customer

satisfaction with the service quality of domestic commercial banks in Bien Hoa

City” The study determines the influence of factors on customer satisfaction on theservice quality of domestic commercial banks in the Bien Hoa City Thereby, theauthor proposes a number of measures to improve customer satisfaction with

service quality here The qualitative and quantitative research methods are

simultaneously applied The analysis results of 700 survey samples collected

directly from customers showed that there are 4 factors affecting customersatisfaction, sorted by degree of decrease: 1) Staff service attitude; 2) Reliability; 3)Tangibles; 4) Employee skills

The author Nguyen Thi Bup (2020) conducts a study on customer satisfaction

about service quality at the Bank for Investment and Development of Vietnam(BIDV) - Tra Vinh Branch, from which proposing solutions to the bank has

gradually perfected the quality of its operations and improved customer satisfaction

On the basis of the 5 quality gap model of Parasuraman et al (1985), the 2-variable

Nordic model of Gronroos (1984), and the 3-factor model by Rust & Oliver (1994),the study proposed the model of measuring customer satisfaction includes 6 factors

including: (1) Reliability, (2) Responsiveness, (3) Assurance, (4) Empathy (5)Tangibles, (6) Price competition

Research by Cassy Gleason and Akua Soadwa (2014) on “Survey of retailbank services in New york”, the two authors surveyed all 207 retail banks across the

state to learn more about the goods and services they offer to individual and small

and medium business The study highlights more than 10 retail banking productsand services that these banks provide, the costs as well as the profits that retail

banking brings (money transfer services, guarantee loans main, supporting payment

of personal income tax) The research by Taiwan, Rajnish and Buse, Stephan (2015)

on “The German banking sector: competition, consolidation brother contentment”

goes into the conceptual study of retail banking services and provides quantitative

research on the contribution of retail banking to the growth of commercial banks.Accordingly, retail banking is a type of bank where individual customers use

products and services at the local branches of major commercial banks Services

provided include: pledge, savings, personal loan, debit card, credit card Retail

banking refers to banks in which direct transactions with individual customers aremore than economic organizations The study of the authors also mentioned that

retail banking is a combination of financial services

The study of Reynold and Philip (2015) on “Retail banking services strategy:

A Model of traditional, electronic and Mixed Distribution choices” did not go into

the concept, explore the types of retail banking services, but went into research onretail banking strategy: Traditional model, electronic model and mixed distribution

options According to this study, the formulation of a retail banking distributionstrategy is an important issue in the banking industry This study shows that the

influence of electronic distribution technology such as PC bank is the strategicchoice for providing retail services The analysis in the study shows that: changes in

attitudes and behaviors of individual customers have a large role in the business

operations of banks, due to banking services for individual customers account for

more than 40% of total transactions

Tran Thi Tram Anh (2011) conducted a study "Improving the quality of retailbanking services at Vietnam Export Import Commercial Joint Stock Bank".Research results show that there are 3 factors affecting the quality of retail banking

services: reliability, empathy and responsiveness Based on the research results, the

author has proposed solutions to improve the above 3 factors to improve the quality

of retail banking services

Vu Thai Hoa (2013) researched on "Improving the quality of retail bankingservices at the Joint Stock Commercial Bank for Investment and Development ofVietnam" Research results show that there are 5 factors affecting the quality of

retail banking services: tangibles, empathy, reliability, assurance and

responsiveness Based on the research results, the author has proposed solutions to

improve the above 5 factors to improve the quality of retail banking services at

BIDV

Thus, although there are many studies related to retail banking and customersatisfaction, very few studies have made a comprehensive assessment of customer

satisfaction with retail banking services Most published studies evaluate the results

of retail banking services or assess customer satisfaction with the quality of bankingservices in general At the same time, the author has not found any research thatassesses and measures customer satisfaction on the retail banking services at BIDV

SGD1 Therefore, the research that the author conducted is the new study does not

overlap the study time and space with published studies

7 Structure of the thesis

The content of the thesis is divided into 03 chapters as follows:

Introduction

Chapter I: Theoretical framework on customer satisfaction on retail banking

services at commercial banks

Chapter 2: Research methodology

Chapter 3: Empirical results

Conclusions: Summary and recommended solutions for improving the level of

customer satisfaction on the retail banking of Joint Stock Commercial Bank forInvestment and Development of Viet Nam - Transaction | Branch

CHAPTER 1 THEORETICAL FRAMEWORK ON CUSTOMER

SATISFACTION ON RETAIL BANKING SERVICES AT

COMMERCIAL BANKS

1.1 Overview of retail banking services of commercial banks

1.1.1 The concept of retail banking

There are many different ways of understanding about retail banking, in the

traditional way, retail banking is the provision of banking products and services directly

to customers (Dao Thi Kieu Anh, 2013) In addition, according to customers, retailbanking is defined as "transaction activities of banks with customers who are individuals

and small and medium enterprises" (the Bank for Foreign Trade of Viet Nam, 2003) Inaddition, the Bank for Foreign Trade experts also pointed out that: "Retail banking is

transaction activities in the range of a few hundred thousand dong to several tens ofmillion dong" In addition, the typical approach in the product and service distributionchannel "Retail Banking" can be understood as the provision of banking products and

services to specific individuals, small and medium enterprises through the network of

branches or customers can directly access to banking products and services through the

means of information technology, electronics and telecommunications (David Cox,

1997)

According to Phan Quoc Thang (2010), retail banking service is the provision ofproducts and services by banks to individual customers or small and medium-sizedenterprises through a system of distribution channels Using retail banking services,

customers can proactively access the service through modern electronic means

According to Phan Thi Thu Ha (2004), retail banking service is a type of service that

mainly provides products directly to individuals, households, and small and medium

enterprises

From the above points of view on retail banking services, the author draws theconcept of the retail banking as follows: Retail banking service is a type of bankingservice serving customers who are individuals, households and small and mediumenterprises through traditional distribution channels (branch networks, transaction

offices) and modern distribution channels (information technology facilities,

electronics and telecommunications)

1.1.2 Characteristics of retail banking

Firstly, the customers of retail banking services are individuals, households,

small and medium enterprises, and micro enterprises’ According to Trinh Ba Tuu

(2014), retail banking’s customers have different markets Heterogeneity shown:Retail banking customers include both individual and corporate clients whilewholesale banking customers are only large-scale corporate clients In addition, the

retail banking customers in the same group are also heterogeneous (Phan Quoc

Thang, 2010) For groups of individual customers, individuals with different levels

of income, consumption, social position, lifestyle, age group, ethnicity, habits,preferences will have their own reactions as well as individual demand for retail

banking products and services For a group of customers individuals ormicroenterprises with different fields of operation, business size, location of

operation, the demand for retail banking services is also very different (Le Cong,2013) Therefore, in order to be successful in exploiting the retail banking market, it

requires banks to carefully segment the market, and at the same time have to be

deeply aware of the process as well as the factors affecting - customer service

behavior

Secondly, the number of customers having demand is large but small scale ofdemand Because retail banking customers are individuals, households, andmicroenterprises, the number of retail banking customers is very large, leading to

the large and regular number of banking transactions (Reynold and Philip, 2015)

However, the value of each transaction is often smaller than the value of wholesale

banking transactions, so it is only corresponding with the needs of an individual

customer, a business (Trinh Ba Tuu, 2014) This feature brings an advantage forretail banking over wholesale banking Regularity and stability in retail transactionscontribute to a significant source of income and sustainable growth of the bank

(Cassy Gleason and Akua Soadwa, 2014) Besides, because the value of retail

? Criteria defined in Decree No 39 /2018 /ND-CP dated March, 1 12018

transactions is not too large, the risks contained in the transactions are also low,

contribute to ensuring safety for banking operations

Thirdly, retail banking service has a diversified portfolio With the

characteristics of the retail banking group of customers is the diverse needs,

heterogeneity, depending on gender, age, culture, and geography, and residence

Therefore, banks that want to develop retail banking services must have adiversified and constantly improving product portfolio (Le Cong, 2013) Both arecredit services but serving the consumption needs of individuals, households, banks

offer a list of suitable services such as: home loans, auto loans, shopping loans

Aiming at students, the bank offers overseas education loans Aiming at micro

enterprises, the bank offers business development loans (Phan Quoc Thang, 2010).The same is a deposit mobilization service, but with different terms and differentconditions for withdrawing principal and interest, there are different services

provided by the bank (To Khanh Toan, 2015)

Fourth, retail banking service has a wide network of branches and distributionchannels The customer of retail banking services are individuals, households, and

micro enterprises scattered over a large area (domestic and international) In order

to reach all types of customers, the bank has to constantly expand its network of

branches, transaction points and ATMs providing services (Reynold and Philip,2015) The more branches and the wider distribution that a bank has, the morecontact conditions with customers, the better competitiveness compared to other

banks (Pham Thi Mong Hang, 2019) In order to increase convenience forcustomers, commercial banks need to focus on developing digital transaction

channels and new transaction channels using modern technology such as online

banking, home banking (Phan Quoc Thang, 2010) In areas where there are no

direct banking transaction points, customers can still conduct some normaltransactions through means such as Internet, Mobile phone This is a characteristicfeature of retail banking services (Bui Thi Diep, 2019)

Fifth, retail banking service is developed on a high-tech platform A veryimportant feature that determines the expansion and development of retail banking

10

services is the application of scientific, technical and technological achievements to

banking operations (Phan Quoc Thang, 2010) Thanks to the development of

science and technology, electronics, telecommunications and the Internet, newbanking services can be provided more and more to all customers today (Nguyen

Thi Bup, 2020) A typical example of the application of high technology in banking

services is cash withdrawal and automatic top-up through the system of machinesand ATM cards; Payment services by domestic and international credit or debitcards; Online banking services Internet banking, Home banking, Phone banking,

automatic money transferring products (Trinh Ba Tuu, 2014) With the help of

technology, customers can now access banking services at any time of the day,

anywhere without being separated by geographical distance, by borders

1.1.3 Main retail banking services

a) Retail fund mobilization service:

Demand deposit: Demand deposit (in VND or other foreign currencies) is

money that customers deposit into the bank to keep and pay for everyday expenses.With this deposit account, the customer can request the issuance of a means of

payment such as checks, cards; check account balances; make domestic and foreign

payments without carrying cash; cash can be withdrawn at any time directly at a

transaction counter or through a system of ATMs, thus this ensures high security(Phan Thi Thu Ha, 2004) The stability of this type of mobilization for banks is nothigh because customers can withdraw money at indefinite times, the bank alwayshas to maintain a certain amount of cash, so interest rates are often low and the bank

will charge customers for account maintenance services (Mac Quang Hung, 2010)

Customers who can use this type of product include: individuals (Vietnamese

citizens and foreign individuals) and other organizations

Term deposit: Term deposit or savings deposit means an amount of moneydeposited by a depositor into a savings account, which is confirmed on the savings

card; complying with the principle of fully repaying principal and interest as

prescribed by the savings deposit receiving organization; in addition, the depositsare insured in accordance with the law on deposit insurance (Nguyen Dang Don,

11

2007) Savings is a traditional form of capital mobilization playing a key role in

creating medium and long term capital, contributing to capital growth This type of

product is only for customers who are individuals (Vietnamese and foreignersresiding and operating in Vietnam), organizations are not allowed to open savings

accounts (Tran Huy Hoang, 2011) The savings account is not used to issue checks

and to make payment transactions, but is used to pay off the loan of the owner ofthe savings deposit at the bank or transfer to another account (another term savingsaccount or current account) of the same customer (Phan Thi Thu Ha, 2004)

Valuable papers (GTCG): is the evidence confirming the debt repayment

obligation between the issuer of the valuable papers and the owners of valuable

papers in a certain period of time, the interest payment and other conditions (MacQuang Hung, 2010) Valuable papers include: (i) deposit certificates, (ii)

promissory notes, (iii) bonds The characteristics of valuable papers are transferableand can be used to pay when necessary without having to wait until maturity

through mortgage or discount operations (Tran Huy Hoang, 2011)

b) Retail credit service:

Consumer loan is a credit that a bank lends to a customer to satisfy the needs

of purchasing durable consumer goods: buying land, building a house, buying a

means of transportation, buying purchasing home appliances (Phan Thi Thu Ha,2004) Although the value of loans is usually not large, while the costs that bankshave to spend as well as the risks to suffer, if they can lend a lot, the banks willexpand relationships with customers, increasing the ability to mobilize mobilize

capital, expand other services, improve the bank's income (David Cox, 1997)

Consumer lending has two forms: loans without collateral and loans with collateral

Overseas education loan: is a credit product aimed at families wishing to send

their children abroad to study abroad with insufficient economic conditions to coverall expenses while studying abroad (Vo Kim Thanh, 2001) According to Le Van Tu(2001), the study abroad loan service meets all the needs arising in the study abroadprocess of international students: payment of tuition fees, living expenses and other

12

necessary expenses, creating favorable conditions for international students in the

learning process

Overdraft is a service that allows individuals to withdraw money from achecking account in excess of the credit balance, up to an agreed limit To enjoy this

service, the account holder must sign a service provision contract with the bank

(Nguyen Dang Don, 2007) The overdraft limit is determined on the basis of cashflow, reputation and solvency of customers Customers are allowed to use the bank'sloan without collateral or deposit, nor go to the bank to pay principal or interest, but

the bank will actively collect the debt from the receivables on the customer's

account This type of service is still not popular in Vietnam but has been very

developed in many countries around the world (Mac Quang Hung, 2001)

Loans to buy land, houses; build and repair houses for individuals: is the

product targeted to customers wishing to buy land and houses; housing constructionand repair but not enough finance to implement it (Phan Thi Thu Ha, 2004)

Depending on the plan and financial resources of the customer, the bank can decidethe value of the loan and the term of the loan

Pledged loan: This is a form that banks finance to satisfy customers’ needs

based on customers’ savings books and cards (David Cox, 1997) With this form of

lending, customers can quickly solve their current needs with simple procedures,without needing to prove their repayment source (Tran Huy Hoang, 2011)

c) Payment service:

Payment service includes: (i) providing customers with checking accounts,issuing checks, payment orders, (11) performing other domestic and foreign payment

services such as domestic and international money transfers (Dao Le Kieu Anh,

2013) With utilities for both individuals and small and medium enterprises,

payment services are being developed, constantly improving service quality (VoKim Thanh, 2001) As a result, the bank can collect a large service fee with littlerisk, attracting customers to use other bank services

d) Card service:

13

Card service is a modern banking service that contributes to the non-cash

payment, providing customers with many benefits With the card product,

customers can: withdraw money, pay money, pay bills, transfer money at ATMswithout going to the bank, pay for some services without using cash (Le Van Tu,

2001) Depending on the different criteria, it is possible to divide into different

cards According to production technology, there are cards: braille cards, magnetictape cards, smart cards (Phan Thi Thu Ha, 2004) According to the territory, thereare two types of cards: domestic cards and international cards According to the

nature of the card, there are: credit card, debit card, cash card (Vo Kim Thanh,

2001) There are two types of card issuers: cards issued by a bank (Bank card), card

issued by a non-bank organization (Nguyen Dang Don, 2007)

e) Other services:

Remittance service: is one of the professional activities of a commercial bankserving the money transfer of individuals from abroad through companies, partners,banks to the recipient who is an individual and the purpose of money transfer is

not related to commercial transactions (Mac Quang Hung, 2010) Currently, the

State's remittance incentive policy has created many opportunities for commercial

banks to expand the remittance market, improving the efficiency of retail banking

services

Electronic banking services: all transactions between the bank and customers(individuals and organizations) rely on the process of processing and transferringdigital data to provide banking products and services (Phan Quoc Thang, 2010) E-

banking services include the following services: mobile banking, phone banking,

internet banking, call center, home banking (Vo Kim Thanh, 2001) The utilities

that these services bring to customers include: searching for information about

products and services of the bank at home; accessing to your account to checkbalances, transfering money, collecting information about exchange rates andinterest rates (Tran Huy Hoang, 2011) Telephone and internet banking services willsignificantly contribute to expanding the banking service market, promoting theefficiency of product distribution channels (Nguyen Dang Don, 2007)

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1.2 Customer satisfaction

1.2.1 Definition of customer satisfaction

According to Hansemark and Albinsson (2004), customer satisfaction is the

overall attitude of a customer to a service provider or an emotional response to the

difference between what a customer predicts and what they will receive, for the

fulfillment of certain needs, goals or wants Meanwhile, Zeithalm and Bitner (2000)said that customer satisfaction is affected by many factors such as product quality,service quality, price, situation factors, personal factors According to Parasuraman,

Zeithaml, Berry (1988), there are 5 factors that affect customer satisfaction with

services: Reliability, Responsiveness, Assurance, Empathy and Tangibles

More specifically, according to Zineldin (2000), customer satisfaction is theemotional feedback/total perception of the customer to the service provider based

on comparing the difference between what they receive and their previousexpectations (Zineldin, 2000) Also on this point of view Kotler (2000) argues that

satisfaction is determined on the basis of a comparison between the results receivedfrom the service and customer expectations, which are considered on the following

three levels: Less than expected, the customer will feel dissatisfied; if the results are

received as expected, the customer will be satisfied; if the results are received more

than expected, the customer will be very satisfied and enjoy the service Meanwhile,Cronin and Taylor (1994) argued that customer satisfaction is a corporate taskexpressed through the relationship between the values of that product or servicecompared to previous expectations of customer

According to Oliver (1989), customer satisfaction is a process as follows: (1)

First, customers form in their thinking expectations about the factors that make up

the quality of service that the supplier can bring them before the customer decides

to buy; (2) Thereafter, service purchase and use contribute to customer confidence

in the true use value of the service they are using; (3) Customer satisfaction is theresult of the comparison between the use value of this service with what thecustomer expected before buying the service Customers will be satisfied with the

15

service when the value of the service completely coincides with the customer's

expectation

Based on the concept of customer satisfaction and the concept of retailbanking, the author presents the point of view on customer satisfaction with retail

banking services as follows: Customer satisfaction on retail banking services is the

satisfaction of customers' needs (individuals, households and microenterprises) in

providing banking services through distribution channels and electrical means

1.2.2 The relationship between customer satisfaction and service quality

The relationship between service quality and customer satisfaction has been a

topic discussed continuously by researchers over the past decades Many studies on

customer satisfaction in service industries have been performed Some authorsbelieve that there is a match between service quality and customer satisfaction so

these two concepts can be used interchangeably However, many studies show thatservice quality and customer satisfaction are two different concepts

Parasuraman et al (1985) argued that there are some differences betweenservice quality and customer satisfaction The main difference is the problem of

"cause and effect" Zeithalm and Bitner (2000) said that customer satisfaction is

affected by many factors such as product quality, service quality, price, situation

factors, personal factors Service quality is just one of many factors affectingcustomer satisfaction Curry and Sinclair (2002) also showed the relationshipbetween product/service quality and customer satisfaction Accordingly, if thequality of the product or service provided meets the customer's expectations, it will

lead to customer satisfaction and in turn, to customer dissatisfaction If the quality is

improved but not based on the customer's need, the customer will never be satisfied

with that service Therefore, when using the service, if customers feel that the

service is of high quality, they will be satisfied and vice versa Thus, service qualityplays an important role in bringing customer satisfaction

According to Parasuraman et al (1988), service quality and customersatisfaction are two different but closely related concepts in service research.Previous studies have shown that service quality is the cause of satisfaction (Cronin

16

and Taylor, 1992; Spreng and Taylor, 1996) The reason is that service quality is related

to service delivery, while satisfaction can only be assessed after using the service

Satisfaction of customers is seen as the result, service quality is seen as thecause, satisfaction is predictive and expected; Service quality is an ideal standard

Customer satisfaction is a general concept that shows their satisfaction when using a

service Meanwhile, service quality focuses only on specific components of the

service (Zeithaml & Bitner, 2000) Although there is a correlation between service

quality and satisfaction, there is little research focusing on verifying the level of

interpretation of service quality components to satisfaction, especially for each

specific service sector (Lassar et al., 2000) Cronin and Taylor (1992) tested this

relationship and concluded perceptions of service quality lead to customersatisfaction Studies have concluded that service quality is the premise of

satisfaction (Cronin and Taylor, 1992; Spereng, 1996) and is the main factoraffecting satisfaction (Ruyter, Bloemer, 1997)

In short, service quality is the factor that influences customer satisfaction If

the service provider brings to the customer quality products that satisfy the

customer's needs, the service provider has made the customer satisfied initially.Therefore, in order to improve customer satisfaction, service providers must

improve service quality In other words, service quality and customer satisfactionhave a close relationship with each other, in which service quality is the pre-created,

decisive factor to customer satisfaction The causal relationship between these twofactors is a key issue in most research on customer satisfaction If the quality is

improved but not based on the customer's needs, the customer will never be

satisfied with that service Therefore, when using a service, if customers perceive aservice of high quality, they will be satisfied with that service On the contrary, ifthe customer perceives the service of low quality, dissatisfaction will appear

1.2.3 Assessing customer satisfaction

1.2.3.1 SERVQUAL model

The SERVQUAL model 1s a service quality research model that 1s popular

and most commonly applied in marketing research According to Parasuraman et al

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(1985), service quality cannot be identified collectively, it depends on customer

perceptions of that service and this perception is considered on many factors The

I dep

SERVQUAL model is built on the point of view of perceived service quality which

is a comparison between expectations and perceptions

peo tes > Expected service

to the consumer

Marketer

A

4 1

Source: Parasuraman et al (1985)

- Gap | is the difference between customer expectations of the service and the

service provider's perception of customer expectations

-Gap 2 is the difference when the service provider translates perceivedexpectations to specific quality criteria and delivers them as expected

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- Gap 3 1s the difference between the actual service provided and the service

quality standards given by the provider This gap occurred because the staff,

facilities, service conditions failed to convey the determined service quality to the

customer.

- Gap 4 is the difference between the transfer service and the information

received by the customer This information may increase expectations but canreduce the perceived service quality when the customer does not receive exactlywhat was committed

- Gap 5 is the customer's perception of the service after using compared with

what they expected If customers don't feel the difference between what they expect

and what they feel after using it, the quality of service is considered perfect

SERVQUAL considers two main aspects of service quality, which are service

results and service provision has been studied, including 10 dimensions: Reliability Says the ability to perform services in a timely and appropriate manner;

1-2 — Responsiveness: Describes the willingness and readiness of service staff toprovide services to customers; 3- Competence: Talking about the qualifications forperforming the service Service ability is manifested when employees interact withcustomers, employees directly perform the service; 4-Access: Related to creating all

conditions for customers to easily access the service; 5- Courtesy: Showing thewarm, friendly and respectful service of staff towards customers; 6-Communication: Expressed through communication so that customers can easilyunderstand and listen to employees' problems that customers reflect; 7 - Credibility:

Demonstrating the ability to create trust for customers, making customers trust the

service provider; 8- Security: Relating to the ability to ensure the safety of

customers, as demonstrated through the physical, financial security and information

confidentiality issues; 9- Knowing the customer: Showing through the ability toknow and grasp customer needs through understanding the needs of customers and

meeting their wants; 10- Tangibles: Demonstrated through the appearance, the attire

of the service staff, the support equipment for the service, the surrounding space

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1.2.3.2 SERVPERF model

The results of experimental research Cronin and Taylor (1992) proposed the

model SERVPERF, which is a variation of the SERVQUAL scale The SER VPERFmodel includes 5 dimensions of service quality: reliability, responsiveness,

empathy, assurance, tangibles Instead of measuring both the expectation and the

perception of the customer as SERVQUAL, Cronin and Taylor (1992) argued thatthe level of customer perception of the enterprise's service performance representsservice quality According to the SERVPERF model: Service Quality = Perception

Figure 1.2 SERVPERF Model

Source: Cronin and Taylor (1992)

When setting up the SERVPERF model, Cronin & Taylor (1992) usetranslation quality attributes of SERVQUAL model but removes the "expectation"part Due to being derived from the SERVQUAL model, the components and

variables observed in the SERVPERF model are the same as SERVQUAL So this

measurement model is also known as the Perception Model Both SERVQUAL and

SERVPEREF models are widely used by subsequent studies in many different fields

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1.2.3.3 Gronroos model (1964)

According to Gronroos (1984), the constituent factors of service quality

affecting customer satisfaction are quite diverse, but it can be summarized into thefollowing three factors: (i) Quality Technical: is the value that the customer actually

gets from the service, the service's quantifiable factors such as: waiting time, service

delivery time, complaint handling time; (ii) Functional quality: is the way thattechnical quality brings to customers Functional quality is often not quantifiablefactors such as: employee's attitude when serving customers, service space; (11)

Enterprise image: is considered a "filter" in the process of customers using the

service Customers can give the initial perceptions about whether the service quality

of the business is high or low based on the perception of the business image

Figure 1.3 Technical quality model, functional qualitySource: Gronroos (1984),

According to Gronroos (1984), technical quality and functional quality worktogether to create a corporate brand image and create the quality of service that thecustomer feels Then, perceived quality is compared with actual expectations and

assessments to help customers verify they are satisfied with the service they are

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using Technical quality and functional quality always have an interactive andsupportive relationship to create service quality In which, technical quality is

considered the basic factor that requires any service to be able to meet it Improvingtechnical quality and functional quality will create a brand image, together with the

enterprise's efforts in serving customers will create quality that best meets

expectations and satisfaction of customers The authors also concluded thatfunctional quality plays a more important role than technical quality That meansthe way the service is provided to consumers is more important than the value they

actually get from that service

1.2.3.4 Research proposal model

Based on the literature review, there are many models of service qualityassessment reflecting customer satisfaction, of which the most widely used model is

the model SERVQUAL: Model of expectation - perception; SERVPERF model:perceived level and Gronroos model: technical quality - functional quality In

which, the model SERVPEREF of Cronin and Taylor (1992) is considered as a moreconvenient method, because the questionnaire is short, saves time and avoids

misleading customers to answer between satisfaction and attitude of customer At

the same time, both the the SERVQUAL model and Gronroos model have certain

limitations, making it difficult to collect information and data of the author, asfollows:

For the SERVQUAL model: The long questionnaire, the content of the samequestion about the customer perception and expectation when using the service will

be boring for the respondents Moreover, respondents are also prone to confuse

satisfaction and attitudes towards service, so the data collected will not be highly

accurate At the same time, the long questionnaire content also took a long time for

both respondents and questionnaires

Gronroos: Model Gronroos evaluates service quality which measurescustomer satisfaction through the technical and functional quality of the services

provided However, this model does not give specific methods of measuring

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technical quality and functional quality, so inheriting the model in the study will not

have a highly feasible province due to difficulty in data collection

As a result, the author chose the SERVPERF model of Cronin & Taylor(1992) with a scale adjustment to study customer satisfaction when using retail

banking services of commercial banks

Figure 1.4 Research proposal model adapted from Cronin and Taylor (1992)

- Reliability: Business will build trust of customers by promising to do

something to customers When customers encounter obstacles, businesses are

always interested in really solving that problem Businesses will promise to do it

right from the start, on time and without any mistakes

- Responsiveness: This is the criterion for measuring the ability to quicklysolve problems, effectively handle complaints, and ready to help customers andrespond to customer requests In other words, service efficiency is the response

from the service provider to what the customer wants specifically: employees in the

company will tell you when to do the service and do it quickly, always ready to help

you when you encounter difficult problems, never too busy to respond to your

request.

- Tangibles: is the external image of facilities, equipment, machines, staffbehavior, documents, manuals and related information systems In general terms,

everything that the customer can see directly with the eyes and senses can affect this

factor: the equipment is always modernized; The company's infrastructure is built in

23

an eye-catching and beautiful manner, the employees in the company are always

dressed neatly and cleanly; the service-related corporate photo books look verynice

- Assurance: This is the factor that creates the trust and confidence for

customers to be felt through professional service, good expertise, politeness and

good communication ability Thus, customers feel secure when using the service.Employees’ behavior creates trust for customers, customers feel safe in dealing withbusinesses, and staff are always welcoming and answer questions in detail

- Empathy: This is the attention and care for customers, giving customers thebest possible care (providing individual attention), helping customers feel they are

important customers, always paying special attention to customers, enthusiastic staffcares about and considers the interests of customers as the mind, understanding the

needs of customers, working at time

1.3 Experience to improve customer satisfaction on retail banking services

1.3.1 Experience of Vietinbank Ha Thanh branch

Strictly comply with the orientations in retail banking service business led by

the Vietinbank Head Office proposed, during the process of formation and

development, Vietinbank Ha Thanh branch always focuses all resources to promote

the development of the retail business, to maximize the potentials and market size

As a result, the branch's retail service business results always exceeded the plan;specifically: in 2019, the branch's retail sales were VND 9,769 billion, reaching105% of the plan (up 23.2% compared to 2017) The branch's retail market share is

always high compared to Vietinbank branches (8.9%) and compared to other

commercial banks in the locality (market share is 17.8%) Achieving the above

results is thanks to efforts in implementing activities to improve customer

satisfaction using the service, a number of measures applied by branches are asfollows:

To create a simple and convenient way for customers to make transactions,

Vietinbank Ha Thanh branch has regularly renewed the process and services

towards simplicity and compactness At the same time, enhancing the ability to

24

meet customers' needs through synchronous investment in all transaction points

managed by the branch, investing in technology projects: LOS, Core BankingSunshine to improve the quality of online banking service, better meet the needs of

customers.

With the support from the head office, Vietinbank Ha Thanh branch has

promoted the research and implementation of high-tech retail banking services,modern services, targeting new generation customers such as: services cardpayment service via Smartphone (M-POS), token security service; upgrading e-

banking service to better meet customers' needs at anytime, anywhere In order to

improve the customer service capacity for its staff, Vietinbank Ha Thanh branch has

regularly carried out the following activities training to improve service quality,communication with customers; training and retraining of staff on banking services

has just been deployed In 2019, the branch has held all 87 training courses, with

165 employees to participate

In order to increase customer satisfaction and create a premise for expandingretail customer scale, Vietinbank Ha Thanh branch has oriented its staff to: learn

and capture detailed information about each customer object Thanks to that, the

staff of the branch has understood customers thoroughly from personal information,

family, occupation, age group, employees can guide and advise on retail productpackages to suit customer needs, improve customer satisfaction, and createopportunities for branches to develop retail banking services

1.3.2 Experience of Vietcombank Ha Thanh Branch

Grasping the development trend of banking business, right from its

establishment, Vietcombank Ha Thanh branch has attached importance to activities:

developing convenient banking services, investing in the application of modern

technology in developing and providing new retail products and services Therefore,the retail business at the branch achieved high results, the annual revenue alwaysaccounts for 25-30% of the total income of the branch; The market share of service

provision is always in the top 2, top 3 compared to other commercial banks in the

area In addition to the strengths like brand name, reputation, technology, to achieve

25

these results, Vietcombank Ha Thanh branch has implemented synchronous

measures to improve customer satisfaction using the service:

Firstly, during operation and development, in order to respond better to theneeds of customers, Vietcombank Branch Ha Thanh has constantly learned,

researched and proposed the deployment of new retail banking services suitable to

customers' demand, as well as friendly with the distribution channel systemmanaged by the branch Currently, the branch is providing all 118 retail banking

services diversified in many fields: capital mobilization; consumer loans; cardservice; insurance services; transfer and receive money; e-banking service

Secondly, in order to improve the accessibility of banking services for

customers, Vietcombank Ha Thanh branch is constantly expanding the number ofautomatic distribution channels, developing transaction systems Online helps

customers to have favorable conditions for transactions with Vietcombank such asPhone Banking, Internet Banking, Contact center, This helps to provide

outstanding services, creating favorable conditions for customers to use service

Thirdly, to improve customer satisfaction, Vietcombank Ha Thanh branch

focuses on improving customer service quality The staff are trained in professional

customer service skills and the management department is always reminded to

provide customers with the best service possible This creates a reputation for thebank to its customers

Fourth, Vietcombank Ha Thanh branch always builds long-term relationshipswith customers through direct marketing with many creative ideas such as providing

members with tours, special entertainment and a variety of other unique products

and services In addition, the bank also carries out advertising and sponsorship

programs to enhance its image promotion and branding

Fifth, Vietcombank Branch Ha Thanh established a separate customer caredivision operating independently, implementing customer care policies Whencustomers call the branch, they will be provided by the customer care department:

free consultation, guidance, information about products and services; At the same

26

time, this department also satisfies customers' queries and complaints in a

satisfactory and timely manner

1.3.3 Lessons learned for BIDV SGD1

From the successes in improving customer satisfaction on the retail banking

services at other commercial bank branches, lessons learned for BIDV Transaction

SGD1 branch is as follows:

- Focus on technology development; study proposed implementation of retailbanking services modern and better serve customer needs, particularly highly

qualified group of customers;

- Review and propose innovation of processes and operations, simplify

procedures and documents create convenience for customers to use the service aswell as improve customer satisfaction

- Building a management apparatus, allocating personnel from departments/

divisions appropriately, ensuring the right arrangement of people, right profession

for the job, ensuring maximum use of the value of human resources;

- Regularly organize training courses, short training to staff, staff to carry out

deployment retail services, in particular for new staff and implemented at the time

of deployment new banking services;

- Improving customer service quality carefully grasp information about eachtype of customer using the branch's retail banking services, especially traditionalcustomers and middle-class customers

- Set up a customer care department to operate independently from other

departments in the branch in order to improve the efficiency of consulting, guiding

and introducing products and services to customers, as well as improving efficiency

of handling customer inquiries and complaints

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CHAPTER 2 RESEARCH METHODOLOGY

2.1 Research process

The research process on customer satisfaction with retail banking services isconducted according to the research process as follows: Initially, the author

identifies the research problem and sets the research objective After determining

the research objective, the author builds the theoretical basis of the researchproblem including the theoretical bases related to customer satisfaction, and theresearch model related to satisfaction of customer The next step is to build up

research methods The research method that the author uses in the thesis is mainly

qualitative research methods and quantitative research methods Qualitative

research methods focus on interviewing experts and building questionnaires, and

quantitative research methods used by SPSS analysis methods include: Cronbach’s

Alpha, Explanatory Factor Analysis (EFA) and multivariate regression Then, the

author will evaluate the level of customer satisfaction through factors and offersolutions

28

Identify research

problem

Research objective

Research method

Qualitativeresearch

Expert interview

Questionnairedevelopment

Cronbach’s

Alpha

Multivariateregression

29

2.2 Research method

2.2.1 Preliminary research

Building a scale for the concepts in the research model of factors affectingcustomer satisfaction based on the research model of the previous authors such as

Cronin & Taylor (1992), Reynold and Philip (2015), Pham Thi Mong Hang (2019),

the questions for each research variable were inherited by the author from theprevious studies In this current study, the research concepts used include:

Assurance, Reliability, Response, Empathy, Tangibles The purpose of this study isthat the author uses these factors to discover if the interviewee knows which factors

are important affecting customer satisfaction or not

In this part, research using hand-to-hand discussion technique is datacollection technique through discussion between two people: researcher and data

collector (Nguyen Dinh Tho, 2011) Because the research's expertise as well as thesubjects’ perspective of the problem are not the same, this discussion helps the

author clarify and deepen the data During the interview process, the author hasdefined and explained the research concepts to the interviewees so that their

contributions are really meaningful to help the research

The interviewee selected by the convenient method is the non-probability

sampling method in which the researcher approaches the sample element by theconvenient method That means researchers can choose elements that they canaccess (Nguyen Dinh Tho, 2011) Experts that the author conducts interviewing are

07 officers, leaders of the Head Office, as well as at BIDV SGD1, directly operating

and managing retail banking operations

The author conducts direct interviews based on the pre-established questions

Some specific contents are conducted as follows:

- Introduce the interviewees briefly about the research topic and the purpose ofthe topic

- Ask a number of questions to identify the main factors affecting customersatisfaction with retail banking services

- Are the questions set out in the scale consistent with reality at the branch?

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