report business research methods the influence of e service quality on customer satisfaction and loyalty in the banking industry in covid 19 pandemic in vietnam

However, in general, most of the current E-Banking services of the above banks meet the basic needs of customers, even reaching their expectations with only 16% of customers expressing d

TON DUC THANG UNIVERSITY

FACULTY OF BUSINESS ADMINISTRATION

INTERNATIONAL BUSINESS



REPORT BUSINESS RESEARCH METHODS THE INFLUENCE OF E-SERVICE QUALITY ON CUSTOMER

SATISFACTION AND LOYALTY IN THE BANKING INDUSTRY IN COVID 19 PANDEMIC IN

VIETNAM

Lecturer: TRAN THI VAN TRANG Group: 1 – Shift: 2 (Tuesday)

Class: 20K70401 Course: 24

Ho Chi Minh City, 14 May 2022

LIST OF GROUP MEMBERS

Chapter 2 (2.2 – 2.2.1 – 2.2.2)

Chapter 5

(5.2)

COMMENT FOR LECTURER

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ACKNOWLEDGEMENT

First and foremost, our team wishes to express their heartfelt

gratitude to Ms Tran Thi Van Trang Ms Trang was the one who

provided us with unwavering assistance and careful direction

throughout our research and survey on the topic of "The influence

of e-service quality on customer satisfaction and loyalty in the

banking industry in Covid 19 pandemic in VietNam." She was a

passionate help and provided specific guidance on the direction of

development, the direction of the study of the subject, as well as

guidance on the appropriate approach, presentation of content, to

go in and analysis of the research laid out, based on her valuable

expertise and research experience That is why we can conduct

our survey and research in the most efficient manner feasible

Second, we would like to express our gratitude to Ton Duc Thang

University's Department of Business Administration for providing

us with the opportunity to research and study the subject

Nonetheless, due to time constraints and a lack of practical

expertise, we were bound to be defective and anxious to obtain

feedback from lecturers and friends Thank you a lot

Research Team

Online banking services in Vietnam are currently developing quite

strongly, especially in cities and urban areas Due to the

outstanding features of E Banking services such as time-saving,

cost-saving, convenient transaction, etc., commercial banks in

Vietnam have been interested in developing this type of service

and have the right policy appropriate administrative reform policy

to meet the development trend Aware of this, each bank tries to

design, step by step perfect the E Banking service and deploy

strong promotions and communication programs to attract

customers It helps banks reduce costs and risks, save time for

customers and banks, in line with the general development trend

of the entire commercial banking system, and keep pace with the

development of public science This article focuses on analyzing

and understanding the correlation between customer loyalty to

ebanking services from central banks and private banks across

Vietnam during the Covid-19 pandemic Based on collecting data

from customer groups from universities, we will analyze and come

up with appropriate strategies so that specific banks in Vietnam

can upgrade their ebanking services to retain old customers as

well as collect more potential customers during this covid

pandemic

TABLE OF CONTENT

CHAPTER 1: INTRODUCTION 1

1.1 Introduction 1

1.1.1 Background: 1

1.1.2 Specific problem : 2

1.2 Problem statement 3

1.2.1 Reason for choosing the topic 3

1.3 Purpose of research 3

1.3.1 Theoretical purpose 3

1.3.2 Practical purpose 4

1.4 Research question 4

1.5 Significance of research 4

1.5.1 Theoretical Significance 4

1.5.2 Practical significance 5

CHAPTER 2: LITERATURE REVIEW 6

2.1 Research concepts & definitions 6

2.1.1 E-banking service quality (EBSQ) 6

2.1.2 E-banking satisfaction (EBS) 7

2.1.3 E-banking Loyalty (EBL) 8

2.2 Previous research 9

2.2.1 Summary key paper: 9

2.2.2 Summary support paper: 10

2.3 Proposal models and hypothesis 10

2.3.1 Research model 10

2.3.2 Hypothesis 11

CHAPTER 3: RESEARCH METHODOLOGY 16

3.1 Research design 16

3.2 Questionnaires design 16

3.3 Measurement scale 17

3.4 Sampling 21

3.5 Collection method 22

3.6 Data analysis method 23

CHAPTER 4: DATA ANALYSIS 25

4.1 Descriptive Statistics 25

4.2 Scale measurement/model 26

4.2.1 Reliability testing 27

4.2.2 Assessing the accuracy of the model 30

4.3 Structure model 32

4.3.1 The overall coefficient defines R Square 32

4.3.2 Path coefficient 33

4.4 Results of verifying research hypotheses 37

CHAPTER 5: CONCLUSION, AND RECOMMENDATIONS/ LIMITATIONS 39

5.1 Research summary 40

5.2 Recommendations 42

5.2.1 RE -> ES (Reliability -> E-banking customer Satisfaction) 43

5.2.2 PS -> ES (Privacy and Security -> E-banking customer Satisfaction)43 5.2.3 WD -> ES (Web design -> E-banking customer Satisfaction) 43

5.2.4 CSS -> ES (Customer service and Security -> E-banking Satisfaction) 44

5.2.5 RE -> EL (Reliability -> E-banking customer Loyalty) 44

5.2.6 EW -> EL 45

5.2.7 CSS -> EL 45

5.2.8 ES -> EL 46

5.3 Limitations and directions for future research 46

CONCLUSION 48

REFERENCES 49

LIST OF TABL Table 1 Measurement scale 17

Table 2 Parameters of variables in Smart Pls 3 23

Table 3 Demographic characteristics based on 274 samples 25

Table 4 Conformity results of factors 27

Table 5 Conformity results of factors 29

LIST OF FIGURE Figure 1 Conceptual framework 9

Figure 2 Research Model by Authors Synthesized 11

Figure 3 Model analysis results Error! Bookmark not defined.

LIST OF ABBREVIATIONS AND ACRONYMS

CSS Customer service and Support

Smart PLS Exploratory Factor Analysis

CHAPTER 1: INTRODUCTION

1.1 Introduction

1.1.1 Background:

In the first half of 2021, we have witnessed rapid progress in the

earnings before tax of Vietnam's banking and finance industry

Impressive numbers continue to appear and shock a series of

scores from the same year last year With new changes,

applications, and integration of many advanced technology

platforms, eBanking Vietnam is going further and further

According to Statista 2020, there are more than 120 million mobile

subscribers in Vietnam, of which more than 75% can register to

use financial services, banking, and online payments This is a

keyboard for eBanking development, and originally, the mobile

platform came first Especially in the context of COVID19

spreading globally as well as in Vietnam, non-cash payment can be

prioritized in terms of safety, limiting the spread and spread, this is

also a meaningful explanation for the strong trend of converting

cash payments to non-cash payments

According to the Government's statistical report, there are

currently 68.17 million people using Internet services in Vietnam

as of January 2020; Mobile Banking has a growth rate of 200% and

currently has about 30 million people using the bank payment

system every day However, in addition to money transfer services

inside and outside the system, consumers do not regularly use

E-Banking's additional services, even without knowing the existence

of these utilities In which, typical services of the industry such as

savings deposit, international money transfer, credit card

payment, insurance purchase or ATM card locking/opening also

have an average awareness (only 30-60% of people are aware of

this issue) and low usage (about 20% of users)

To explain the above phenomenon, the authors of this article think

that many banks have not yet implemented expanded services as

well as the digital conversion motivation of E-Banking users as the

main reason for the level of awareness and low additional service

usage At the present time, customers use E-Banking mainly in the

ability to be proactive, save transaction time and be flexible in

transaction locations (>80% of customers) Therefore, the form of

using E-Banking by consumers has only stopped at normal daily

transactions (transfer, phone top-up, electricity and water

payment) but has not been extended to other services Services

that need assurance of confidentiality and need direct advice such

as savings or insurance

1.1.2 Specific problem :

The Covid 19 pandemic that suddenly hit Vietnam at the beginning

of 2020 forced us to isolate and limit social activities such as

shopping and playing All trading and trading activities are

restricted and stagnant, forcing us to gradually shift to buying and

selling and mainly using e-banking services With the growth rate

of Mobile banking up to 200% and about 30 million people using

banking payment services every day in Vietnam Banks in Vietnam

need to know how to retain and find their customers through

changing their interface and services to suit the needs of their

customers over time

When asked about the barriers preventing them from using

E-Banking, the majority of users said that the weakness of this

platform is that it still has limited features (for example, low

transaction limits) Moreover, some users still do not trust

E-Banking because the system is not stable or there is an error

causing the transaction to be interrupted In addition, the desire to

directly listen to advice at the table is also one of the important

barriers in the eyes of users during the transition to a digital

platform However, in general, most of the current E-Banking

services of the above banks meet the basic needs of customers,

even reaching their expectations with only 16% of customers

expressing dissatisfaction with digital banking applications But the

problem is we’re currently living in a middle of a pandemic, so the

desire of being able to directly listen to advice at the table instead

of using e-banking apps is hard to please So that the main reason

for us to choose this topic is to analyze and make

recommendations for banks to develope their e-banking apps to

reach their customers needs and from that forming a behaviour in

using e-banking more often for every citizens in Viet Nam

1.2 Problem statement

1.2.1 Reason for choosing the topic

The purpose of this research paper is to provide recommendations

for banks based on real research to maintain customer satisfaction

and loyalty during the covid pandemic

1/ Investigate the factor influence the changes in the economic

structure as well as the way people consume and live through the

covid pandemic in 2022

loyalty High quality of website design (WD) is essential If banks

are to maintain and ensure their clients' electronic satisfaction

(ES), high website design (WD) is essential According to our

result, an Easy-to-use interface is the factor that users appreciate

and care about the most Moreover, the elements of colors and

items are still interesting, but customers do not have certain

standards, so banks need to shape the consistent style of the

brand to attract interaction from users

Therefore our suggestion for this element is that banking firms

should have a detailed and clear survey of the "easy to use"

conditions of users and need an eye-catching design because

nowadays the brand's image is a prerequisite for customer

satisfaction

5.2.4 CSS -> ES (Customer service and Security -> E-banking

Satisfaction)

In different businesses, customer service means different things,

yet it always boils down to the same core elements The banking

industry, where technology is advancing our understanding of

personal and business finances Customer service excellence

requires keeping up with both live and digital choices for

conducting transactions ranging from simple to complex

According to our research in service and security field banking

customers are very careful that their personal information is kept

private, their monetary transactions must be personal Absolute

security

and the bank's information is secure and this is especially

noticeable when on the online platform Therefore to gain the trust

of customers, the security factor as well as protecting the interests

of customers is a prerequisite, so banks need to focus on

developing this field to the highest level possible through many

such as having top-notch privacy policies for customers both

online and offline

5.2.5 RE -> EL (Reliability -> E-banking customer Loyalty)

As mentioned in the RE to ES section, for EL too, RE is one of the

main factors to attract and retain customers, so financiers need to

improve their trust through security and Policy for customers

According to the data we collect, customer loyalty of e-banking

services is affected by RE up to 30% Customer Reliability as a

reputation might be the most dependable indicator of service

quality and can be linked to previous customer experiences

Because it is on an online platform, there are many hidden risks,

so doing a good job to ensure the safety of customers' information

is clearly what e-banking services need to invest in to achieve

gain the loyalty of the majority of users

PS -> EL (Privacy to E-banking customer Loyalty)

Many consumers have avoided online services, including mobile

phone services, due to concerns about the privacy of personal

information and communications Moreover, because of the

growing number of mobile phone users around the world, the

researcher decided to look into privacy as a predictor of customer

loyalty on e-banking services The PS factor, like the ES factor RE

also has an effect on the EL factor, and while it is minor, it has a

significant impact Therefore, banks need to have the most

reasonable and clear policy terms for dear customers to achieve

their highest loyalty

5.2.6 EW -> EL

As mentioned above, in the current digital age for customers,

brand image and usage on online platforms are very important, so

e-banking websites and applications are not only necessary

eye-catching designs but their applicability must also be optimized, in

the least time and most effective

5.2.7 CSS -> EL

Receiving careful care from service providers is an indispensable

factor when it comes to customer loyalty According to our survey,

e-banking users are very concerned that when they have trouble

or malfunction when using an online platform, especially for

monetary transactions, they will be supported by the bank In

order to be able to correct errors as well as avoid damage from

errors With this problem, banks need to have an online team 24/7

to be ready to receive information and promptly timely support

errors for them

5.2.8 ES -> EL

Customer satisfaction is the foundation for which any business

may fulfill its goals In other words, client satisfaction indicates

how well an organization is meeting its objectives Customer

Satisfaction is to tell people about their experiences, more so,

dissatisfied customers will also tell people about their experiences

To gain loyalty, administrators need to gain their satisfaction with

e-banking services, especially during the Covid-19 pandemic To

achieve satisfaction, banks need to do well on the independent

variables mentioned in this report such as: Reliability, Privacy and

Security, Web design, Customer service and Support