A study on customer satisfaction for retail lending services of joint stock commercial bank for investment and development of vietnam phu tho branch

LIST OF TABLES Table 4.1: Credit balance situation of BIDV Phu Tho in the period 2020-2023 22 Table 4.3: Reliability Statistics of Reliability Scale 27 Table 4.4: Item-Total Statistics o

INTRODUCTION

Introduction

In the current challenging global economic landscape, Vietnam, as an open economy, is significantly impacted This influence extends to the banking sector, particularly evident in the issue of credit growth Credit activities are vital for banks, constituting a major portion of their revenue However, the overall credit growth in Vietnam has been declining, falling below expectations in recent years For instance, in

2023, despite the State Bank setting a credit growth target of 14-15% in Directive No 01/CT-NHNN on January 17, 2023, the actual credit growth for the entire banking system in 2023 only reached 13.71% (Dao Minh Tu, 2024)

This scenario has intensified competition among banks to attract loan customers

In this competitive environment, customer satisfaction becomes pivotal for a bank's survival and brand positioning Hence, Vietnamese commercial banks continuously seek ways to enhance customer satisfaction with credit services

Regarding BIDV Phu Tho, data provided by the Planning - Finance Department of the bank reveals a fluctuating trend in the bank's credit growth in recent years, occasionally lapsing in achieving established objectives Between 2020 and 2021, the credit growth rate reached a relatively high level of 17.15% However, in 2022, there was a notable decline of 6.45%, resulting in a modest growth rate of 10.70% Subsequently, in 2023, there was a slight uptick of 0.69%, bringing the growth rate to 11.39% This inconsistent trend of growth in lending could be attributed to customers curtailing expenditure and downsizing business activities amidst economic downturns Alternatively, it is feasible that customers have been enticed by rival banks within the area

Therefore, conducting “ A study on customer satisfaction for retail lending services of Joint Stock Commercial Bank for Investment and Development of Vietnam

- Phu Tho branch ” is imperative This study aims to identify factors influencing customer satisfaction, propose solutions to enhance their satisfaction, thereby attract new customers, retain old ones, and boost the competitiveness of BIDV Phu Tho.

Objectives of the study

The primary aim of this study is to evaluate customer satisfaction with the retail lending service provided at BIDV Phu Tho Additionally, the study aims to propose effective solutions to enhance customer satisfaction with the retail lending services of the bank To achieve these overarching goals, the research article outlines three following specific objectives:

- Determining factors influencing customer satisfaction of retail lending services of BIDV Phu Tho, and how much each factor affects it

- Measuring customer satisfaction on the retail lending service of BIDV Phu Tho branch based on factors that have been identified as affecting customer satisfaction

- Proposing solutions to enhance customer satisfaction of retail lending service in

Significance of the study

The study evaluates and proposes solutions for enhancing retail lending service quality of BIDV Phu Tho Therefore, it is reasonable to indicate that BIDV Phu Tho is the most beneficial party The bank can utilize the outcomes of this study to improve customer satisfaction levels regarding their retail lending offerings Furthermore, customers using the retail lending service of BIDV will also partly benefit from this research, because when the service is improved based on feedback and research from customers, they will have a better service experience

Moreover, this study is expected to be served as a valuable reference resource for upcoming academics, particularly students at the Banking Academy of Vietnam, who may delve into analogous areas of study This study aims to contribute a multidimensional, objective view in the field of retail lending services within the banking sector

Furthermore, throughout the research process, I had an opportunity to collaborate closely with my supervisor, benefiting from her guidance and direction on the research This collaboration facilitated the enhancement of my scientific research and critical thinking abilities Lastly, presenting and defending the research findings before the scientific council offers me invaluable opportunities for honing my communication and presentation skills, as well as bolstering my confidence.

Scope and limitations

The primary focus of this study centers on customers utilizing services provided by BIDV Phu Tho, as it was conducted internally within this bank Besides, among BIDV Phu Tho customers, the study only aims at the ones using the retail lending service from the beginning of 2024 to the end of February 2024

Due to the time restrictions, the study only examines a small number of variables that influence customer satisfaction on the personal credit services provided by the bank

Chapter 1 offered an overview of the current trend of credit growth and elucidates the rationale behind selecting the topic Additionally, it delineates three specific objectives of the study, highlights the significance of the research, and outlines the scope and limitations of the study.

LITERATURE REVIEW

Related literature

So far, there are numerous studies on customer satisfaction with retail lending services Here are some related researches:

In her master's thesis titled “Factors affecting customer satisfaction with the quality of personal credit services at Techcombank Can Tho branch” (2016) Le Thi Thanh Giang identified the factors influencing customer satisfaction levels for personal credit services at the Techcombank Can Tho branch The research applied the SERVPERF model, including five dimensions: Reliability, Responsiveness, Assurance, Empathy, and Tangibles; at the same time expanded the model by incorporating the Loan Products dimension The study employed the method of random sampling in the form of convenient sampling, conducting with survey questionnaires in person or by phone, resulting in 126 valid samples Analytical methods included testing the Cronbach's Alpha reliability coefficient, EFA, and MLR Analysis

Following the results of the EFA, the scale of factors affecting customer satisfaction for personal credit services is adjusted, resulting in a new scale comprising

5 components: responsiveness and assurance, tangible, reliability, and loan products, with 24 observed variables The outcomes of the multiple linear regression analysis indicated that two factor groups including “Reliability”, “Responsiveness and Assurance” significantly influenced customers satisfaction with the service provided by the bank The remaining two components, “Empathy” and “Loan products” were found to impact customer satisfaction but were not deemed significant Additionally, the research results revealed that variables such as age, gender, and education level also influenced customer satisfaction

The managerial implications aimed at enhancing customer satisfaction when utilizing personal credit services at the Techcombank Can Tho branch, with the objective of retaining current customers and attracting new ones, were suggested based on the research results

Nevertheless, this study is constrained by its focus solely on certain factors concerning client contentment with personal credit services provided by Techcombank Can Tho The research results indicate that a number of factors affecting customer satisfaction are not yet researched within the scope of this thesis

In 2014, Ha Nam Khanh Giao and Tran Hong Hai conducted a study titled

“Customer Satisfaction towards ATM Services: A Case of Vietcombank Vinh Long, Vietnam” The researchers surveyed 800 customers at Vietcombank using questionnaires and obtained 779 valid observed variables The collected data were processed using SPSS and AMOS 20.0 software

The research model was developed through adjustments made to the SERVPERF scale comprising five factors: reliability, responsiveness, empathy, assurance, and tangibles Two additional factors Network and Price were incorporated to form a new scale EFA, CFA, and SEM techniques were employed in the research

Following EFA, the perceived service quality scale was adjusted from the original

7 components to 6 components The scales for responsiveness and assurance were amalgamated into a new factor named Assurance and Responsiveness However, during the model testing utilizing SEM, minimal impact on customer satisfaction was observed for the variables “Assurance and Responsiveness” and “Tangibles”, resulting in their subsequent elimination

As a result, the study identified four factors with high Beta coefficients, indicating their strong impact on customer satisfaction In descending order of importance, these factors are Price, Network, Empathy, and Reliability Despite the noteworthy effects of the Price, Network, and Empathy factors on client satisfaction, their levels of satisfaction were found to be relatively low Consequently, solutions were proposed to improve these three factors Conversely, relatively high customer satisfaction was observed for the Reliability factor, prompting measures to further enhance this strength

In a study conducted by Truong Thi Quynh Trang from Foreign Trade University in 2021, titled “Analyzing factors affecting the quality of personal credit services at Vietnam Maritime Commercial Joint Stock Bank - Thanh Xuan Branch”, the researcher emphasized the importance of service quality and customer satisfaction for the existence and development of banks The study aimed to identify factors that influence the quality of personal credit services The identified factors were as follows:

- Reliability : refers to the bank's ability to provide accurate, punctual, and reputable services

- Responsiveness : relates to the bank's ability to quickly solve problems, effectively handle complaints, and meet customer requests

- Assurance : encompasses the service style, professional knowledge, communication ability, and ability to understand customers of the bank staffs

- Empathy : involves attentive and considerate customer care provided by the bank

- Tangibles : includes the external image of facilities and rooms, documents, manuals, and the banking communication system

The study formulated several hypotheses to test the relationship between these factors and customer evaluation of the bank's personal credit services The hypotheses were as follows:

- H1 : The higher the Reliability, the higher the customer evaluates the quality of the bank's personal credit services

- H2 : The better the Responsiveness, the higher customers evaluate the quality of the bank's personal credit services

- H3 : The better the Assurance, the higher customers evaluate the quality of the bank's personal credit services

- H4 : The more Empathy, the higher customers evaluate the quality of the bank's personal credit services

- H5 : The better the Tangibles, the higher customers evaluate the quality of the bank's personal credit services

The research results indicated that all five factors had positive standardized Beta coefficients, supporting the acceptance of hypotheses H1 to H5 This suggests that the factors identified in the study positively influence customer satisfaction with personal credit services at MSB Thanh Xuan.

Theoretical and Conceptual framework

Service quality is a concept that has received a lot of attention and debate in scientific research Gronroos (1984) defines service quality as the difference between customer expectations and their perception of the service that was received Another common understanding of the service quality concept considers it as the degree to which a service meets customer expectations (Lewis & Mitchell, 1990; Dotchin & Oakland, 1994; Asuboteng et al., 1996; Wisniewski & Donnelly, 1996, cited by Arash Shahin,

2010) If the perception exceeds expectations, service quality is considered high.

Services are intangible, heterogeneous and inseparable Furthermore, service quality assessment depends on personal feelings and psychological states, which tend to be influenced by relationships between people (Ghobadian, Speller & Jones, 1993; Groth & Dye, 1999; Zeithamlet al., 1999; cited by Thongmasak, 2001) These characteristics of services make measuring service quality very difficult For a long time, many researchers have conducted many studies to measure service quality Gronroos

(1984) believed that service quality must be evaluated on two aspects: (1) technical quality and (2) functional quality In particular, technical quality is related to what is served, while functional quality refers to how it is served Parasuraman et al (1985) indicated that service quality is measured by the gap between perceived quality and expected quality of service and proposed the SERVQUAL scale consisting of 5 components: reliability, responsiveness, assurance, empathy, tangibles to measure Cronin and Taylor (1992) believe that service quality is evaluated by customer perception

Kotler and Keller (2006) believed that customer satisfaction is a person’s feeling of satisfaction or dissatisfaction derived from comparing the outcomes of utilizing a product/service with their expectations.

Richard L Oliver (1997) defined customer satisfaction as the reaction of customers to the fulfillment of their desires.

Customer satisfaction, according to Bachelet (1995), is the customers' emotional reaction to their experience with a product or service.

2.2.3 Relationship between service quality and customer satisfaction

The majority of researchers believed that service quality and customer satisfaction are positively correlated (Cronin and Taylor, 1992; Spereng, 1996) According to Chang et al (2017), good service efficiency is anticipated to lead to increased customer satisfaction, and it will enhance customer engagement and relationships, according to Chang et al (2017) Edward and Sahadev (2011), asserted that service quality and customer satisfaction are crucial components of business operations, as a company's growth largely depends on how well the company retains its customers through service and how they keep their clients satisfied

SERVQUAL is a multidimensional scale developed to evaluate service quality by gathering information from respondents about their expectations and perceptions of service quality The notion of service quality is decomposed into five factors by the scale as follows:

- Reliability - ability to perform services as promised in the contract, accurately and reliably

- Responsiveness - staff enthusiasm and readiness to provide prompt, effective service to customers

- Assurance - ability of staff to grasp needed information to serve customers, and inspire their confidence

- Empathy - level of care provided to each individual customer

- Tangibles - equipment, physical facilities, staff attire, etc

The SERVQUAL scale is divided into two parts, each containing 22 statements The first part determines customer expectations for a type of business service In other words, this section does not mention any specific business; respondents indicate their level of expectation regarding the surveyed service The remaining part assesses the customer's perception of the service quality provided by the surveyed business The research results aim to determine the gap between customers' perception of the service quality of the surveyed businesses and customers' expectations for that service quality Specifically, according to the SERVQUAL model, service quality is determined as follows:

Quality of service = Perceived level (P) - Expected value (E)

A positive gap (P - E) indicates that customers are highly satisfied with the service Conversely, a negative gap suggests dissatisfaction with service quality A gap of zero signifies that customers are content with the provided service quality

It can be seen that the SERVQUAL model is widely used in measuring service quality and customer satisfaction However, using this model to evaluate customer satisfaction also causes many debates between researchers (Carmen, 1990; Babakus & Boller, 1992; Cronin & Taylor, 1992) Cronin and Taylor argued that the analytical framework following the SERVQUAL model of Parasuraman et al (1985) easily confuses customer satisfaction and attitude They stated that service quality can be conceptualized as “similar to an attitude” In particular, they maintained that

“performance'” instead of “performance ± expectation'” better determines service quality

In 1992, Cronin and Taylor proposed the SERVPERF model based on the SERVQUAL model which was believed to be better than the SERVQUAL model The SERVPERF model eliminates the scale of customer expectations and retains only 22 statements assessing customers' perceptions of the quality of service they received Therefore, the questionnaire in the SERVPERF model is half shorter than the SERVQUAL scale, thereby saving time and avoiding confusion of respondents when they do the questionnaire According to the SERVPERF model, service quality is defined as follows:

Quality of service = Level of perception

Lee et al (2000) and Brady et al (2002) agreed that consumers rely on their perceptions of service performance when assessing service quality, and indicators based on performance have demonstrated superior capability in distinguishing quality from satisfaction

Moreover, Alén (2006) demonstrates that the perception scale utilized in SERVPERF exhibits superior psychometric properties compared to the “P minus E” perceived service quality model employed in SERVQUAL

Nguyen Huy Phong, Pham Ngoc Thuy (2007) found that the questionnaire according to the SERVPERF model is half as brief as SERVQUAL, thanks to which it does not cause boredom and waste of time for respondents Furthermore, although the SERVPERF scale is simple, it gives better results because when asked about the level of perception, customers often tend to compare desires and feelings in their mind to answer the questionnaire

Referring to all the theories and studies mentioned above, the SERVPERF model of Cronin & Taylor (1992) is utilized to conduct the study However, since in different industries and different business environments, customer perceptions are different, the scale of service quality is adjusted to suit the actual conditions of the banking industry

The model of assessing customer satisfaction with retail lending services at BIDV Phu Tho in this research should consist of six factors which include:

In addition, to test the impact of 6 independent variable groups on customer satisfaction in retail lending services at BIDV Phu Tho, Customer Satisfaction is made the dependent variable of the model The research model of the study will be as follows:

(Source: Self-synthesis) Figure 2.1: The BIDV Phu Tho customer satisfaction assessment framework Interpretation of variables:

- Reliability: measures capacity to provide retail lending services precisely as promised to clients, with a focus on accuracy and credibility in the first performance

- Responsiveness: measures the enthusiasm and preparedness of staff members to offer consumers efficient, quickly retail lending services

- Assurance: measures the bank staffs' level of expertise, service style, capacity to build confidence in clients, and ability to understand pertinent information needed to assist customers of the bank staff

- Empathy: measures the level of personalized care provided to customers using retail lending services

- Tangibles: measures retail lending services equipment, bank facilities, and staff attire

- Loan product: measures the variety, price, and suitability of loan products to customers

And this is how the research model appears

In which, β1, β2, β3, β4, β5, β6 are regression coefficients

(The codes are explained in section 3.6.3)

- H0: All factors including Reliability, Responsiveness, Empathy, Assurance, Tangibles, and Loan products cannot be used to measure customer satisfaction

- H01: Reliability has a positive impact on Customer Satisfaction

- H02: Responsiveness has a positive impact on Customer Satisfaction

- H03: Empathy has a positive impact on Customer Satisfaction

- H04: Assurance has a positive impact on Customer Satisfaction

- H05: Tangibles has a positive impact on Customer Satisfaction

- H06: Loan products have a positive impact on Customer Satisfaction

Chapter 2 consolidates and assesses three studies to propose a research model considered suitable for this thesis Additionally, this chapter introduces two research models for evaluating service quality: the SERVQUAL model and the SERVPERF model Following this, the study opts for the SERVPERF model as the research framework for the topic, owing to its advantages Finally, it delineates the hypotheses that require testing.

RESEARCH METHODOLOGY

Locale of the study

The study is conducted at the Joint Stock Commercial Bank for Investment and Development of Vietnam - Phu Tho branch It is located at No 1155A, Hung Vuong Street, Tien Cat Ward, Viet Tri City, Phu Tho Province.

Research design

Saunders (2012) states that the research design comprises the array of research methods and techniques selected by a researcher to execute a study This framework enables researchers to refine the chosen methods applicable to the subject matter and establish their studies for optimal outcomes The three prevalent research methodologies are qualitative, quantitative, and mixed methods

The study employs a quantitative research approach, chosen for its effectiveness in systematically comparing data, generalizing findings to broader populations, and testing hypotheses against established theories Quantitative methods are particularly suitable when seeking extensive comparisons or generalizations within a specific population or across diverse populations In this study, the focus lies on both lies on generalizing individual customer satisfaction with credit services to the entire population, and testing theories with following hypotheses:

- Reliability has a positive impact on Customer Satisfaction

- Responsiveness has a positive impact on Customer Satisfaction

- Empathy has a positive impact on Customer Satisfaction

- Assurance has a positive impact on Customer Satisfaction

- Tangibles has a positive impact on Customer Satisfaction

- Loan products have a positive impact on Customer Satisfaction

Quantitative research questions encompass both descriptive and comparative inquiries Through descriptive research questions, the factors influencing customer satisfaction with BIDV Phu Tho's retail lending services can be delineated Subsequently, satisfaction levels will be assessed and compared across these factors and the population Research hypotheses are also formulated to assess the extent of customer satisfaction relative to each factor

The variables consist of the dependent variable, which is the satisfaction level of individual customers utilizing credit services from BIDV Phu Tho, and independent variables, including Reliability (REL), Responsiveness (RES), Empathy (E), Assurance (A), Tangibles (T), and Loan products (P).

Population and Sampling description

The study targets the entirety of customers utilizing retail lending services of BIDV Phu Tho from the beginning of 2024 to the end of February 2024 It is estimated that 1492 customers fall within this specified population

In this study, considering the position of the researcher as an intern at BIDV Phu Tho, the non-probability sampling technique, specifically convenience sampling, is deemed more suitable Convenience sampling allows researchers to “easily approach research subjects, especially when researchers have existing knowledge about customers and banking services” (Estelami Hooman, 2003) In this research, convenience sampling is selected based on the availability of customers at BIDV Phu Tho, enabling the researcher to approach them easily

According to Yamane Taro (1967) when the overall size is known, the following formula is used to determine the sample size for the study:

𝑛 represent the sample size to be determined

𝑒 signify the allowable error Typically, the three commonly utilized error rates are: ±01 (1%), ±0.05 (5%), ±0.1 (10%)

In this study, the chosen error rate is 10% Consequently, employing the aforementioned formula, the sample size in this research is as follows:

In accordance with the population size of 1492, it is determined that the minimum required sample size is 94

In order to avoid the scenario where the sample size fails to meet requirements after removing invalid questionnaires, a sample size of 155 was chosen Subsequently,

155 hard copies of the questionnaires were distributed to customers using retail lending services provided by BIDV Phu Tho, resulting in the collection of 147 valid questionnaires

The sample encompasses a diverse array of customers, exhibiting variations in gender, age, and occupation Their income levels span a broad spectrum, ranging from less than 5 million Dongs to over 15 million Dongs per month The loan purposes of customer cover the entire spectrum of loan products offered by BIDV Phu Tho, including home loans, auto loans, overseas education loans, household business loans, and unsecured personal installment loans Furthermore, the durations of the customer loans vary, encompassing short-term, medium-term, and long-term periods A summary detailing the respondent characteristics is provided in section 4.1.

Research instrument

The research primarily aims to identify the factors influencing customer satisfaction in retail lending services of BIDV Phu Tho and assess the magnitude of each factor, with questionnaires serving as the principal research instrument In the questionnaire method, data is collected from many people at the same time Survey participants were asked to complete a questionnaire that the researchers had prepared, the answers had to follow a certain convention

The rationale for selecting questionnaires as the primary method of data collection of this study is that in a short amount of time, it allows the researcher to obtain a rich source of information and a large number of survey samples As a result, the obtained data is ensured to be truthful, objective, and valuable while optimizing time and cost efficiency

The questionnaire consists of eight parts with 33 items

PART Variables Number of items

The study uses a 5-point Likert scale which includes: (1) Strongly disagree, (2) Disagree, (3) Neutral, (4) Agree, (5) Strongly agree

Data gathering procedure

Secondary data are gathered from a variety of sources, both internal and external Internal sources are provided by the Planning – Finance Department of BIDV Phu Tho, and consist of annual summary reports spanning from 2020 to 2023 External information is collected from the BIDV website, previous studies, and newspapers

Figure 3.1: Data gathering procedure Step 1: Designing the questionnaire

The questionnaire was designed based on the SERVPERF model of Cronin and Taylor (1992) It is divided into 2 parts, the first part is 7 questions about basic customer information, the rest includes 26 statements of 7 factors: Reliability, Responsiveness, Assurance, Empathy, Tangibles, Loan products and Customer satisfaction

The questionnaire was sent to 10 customers, the advisor for their feedback and suggestions, from which the questionnaire was adjusted to unclear parts, added missing elements The revised questionnaire was then sent to these individuals to test its suitability The result of this step is to obtain a complete questionnaire

Step 3: Conducting survey in BIDV Phu Tho

Conducting survey in BIDV Phu Tho

The study was conducted at BIDV Phu Tho A total of 155 printed paper questionnaires were administered directly to 155 distinct clients visiting BIDV Phu Tho for matters concerning personal loans The respondents were expected to provide sincere responses to the statements in order to maintain the survey's authenticity Consequently

152 completed questionnaires were collected, reflecting a response rate of 98%

After excluding 05 collected questionnaires that were blurred or not executed as required, out of the 152 returned questionnaires leaving 147 questionnaires to be utilized as the dataset during the data processing stage The collected data was statistically compiled via SPSS software version 20.0.

Statistical treatment of Data

After the collection of questionnaires was completed, each questionnaire underwent evaluation to ensure compliance with the research criteria Out of the 152 collected questionnaires, 04 of them were found to be incompletely filled out and 01 questionnaire was incorrectly scored according to the convention Consequently, those

05 questionnaires, accounting for 3.4% of the returned questionnaires had to be omitted from the dataset The final count of valid questionnaires amounted to 147 Subsequently, the data collected from the questionnaires underwent encoding and were entered into SPSS software version 20.0

Data coding entails converting data into an analyzable format This necessitates establishing a coding framework during data entry to ensure comprehensive, consistent, and non-overlapping coding formats Each data item in the study is assigned numerical values; for instance, responses to gender are coded as Male = 1 and Female = 2

The factors influencing customer satisfaction with the retail lending services of BIDV Phu Tho can be categorized into 8 following distinct groups:

Group 1: Reliability with 4 variables denoted from REL1 to REL4

Group 2: Responsiveness with 4 variables denoted from RES5 to RES8

Group 3: Assurance with 4 variables denoted from A9 to A12

Group 4: Empathy with 4 variables denoted from E13 to E16

Group 5: Tangibles with 4 variables denoted from T17 to T20

Group 6: Loan products with 3 variables denoted from P21 to P23

Group 7: Customer satisfaction with 3 variables denoted from S24 to S26

Group 8: Customer information with 7 variables denoted from I27 to I33

Cronbach's Alpha coefficients are employed to assess the reliability of all factors and scales These coefficients serve as fundamental metrics for identifying and discarding error variables

The data cleaning procedure entails the removal of errors that may arise during data collection, coding, and entry stages It was initiated promptly upon the completion of data entry Various data cleaning assessments, including validity, consistency, accuracy, duplication checks, among others, were conducted to exclude the presence of miscodes or out-of-range codes

Chapter 3 is dedicated to detailing the research methodology employed in the study The research was designed according to quantitative methods, utilizing questionnaires to fulfill the objectives outlined in Chapter 1 Furthermore, this chapter outlines the research sample and the research instrument utilized Additionally, a four- step data processing procedure is elucidated, along with the statistical treatment of data utilized in the thesis.

FINDINGS AND DISCUSSION

Overview of BIDV Phu Tho and its retail lending services

4.1.1 Overview of BIDV Phu Tho

BIDV Phu Tho, one of the 190 branches of BIDV, was established on May 27th,

1957, and is situated at No 1155A, Hung Vuong Street, Tien Cat Ward, Viet Tri City, Phu Tho Province

The history of formation and development of BIDV Phu Tho is intertwined with that of BIDV Throughout its operational journey, BIDV Phu Tho underwent two separations as follows: In 1995, it segmented the state budget lending division, transferring it to the Investment Department (now the Development bank) as per Decision No 654/TTg dated November 8th, 1994, issued by the Government In 1997, the division of Vinh Phu province into Vinh Phuc province and Phu Tho province led to the separation of BIDV Vinh Phu (former) into BIDV Phu Tho and BIDV Vinh Phuc

Commencing business as a commercial bank on January 1st, 1995, under the decision of the Governor of the State Bank of Vietnam, BIDV Phu Tho embarked on capital mobilization from the public and the development of various services such as international and domestic payments, guarantees, etc Over time, it gradually adjusted the revenue structure towards increasing the proportion of revenue from services

BIDV Phu Tho's scope of activities encompasses:

- Capital mobilization: Engaging in activities such as receiving deposits from customers in domestic and foreign currencies, issuing certificates of deposit, bonds, bills, and other instruments to mobilize capital, as well as borrowing from state financial institutions and customer borrowing forms as regulated by the State Bank of Vietnam and approved by BIDV

- Credit activities: This involves providing loans in domestic and foreign currencies, guarantees, discounting, and other forms of credit as regulated by the State Bank of Vietnam and delegated authority of BIDV

- Payment and treasury services: Focusing on providing payment and treasury services to customers, including domestic and international payments, customer collection and payment, cash and check collection and payment

- Other activities: Apart from core business services, BIDV Phu Tho provides supplementary services such as agency and trustee activities, insurance, capital management services, brokerage services, card services, electronic banking services

4.1.2 Retail lending services of BIDV Phu Tho

In terms of retail lending services, BIDV Phu Tho offers the following services:

Table 4.1: Credit balance situation of BIDV Phu Tho in the period 2020-2023

(Source: Planning – Finance Department of BIDV Phu Tho)

As can bee seen in Table 4.1, BIDV Phu Tho's total credit balance has exhibited an upward trajectory from 2020 to 2023, indicating an active expansion of its lending activities Starting at 7157.5 billion Dongs in 2020 and reaching 10339 billion Dongs by

2023, this trend suggests a strategic approach to increasing their credit portfolio, possibly in response to market demand or as part of their growth strategy

However, the performance of the bank's retail lending services presents a more nuanced picture While the retail lending balance has indeed increased over the same period, rising from 2844 billion Dongs in 2020 to 4482 billion Dongs in 2023, the ratio of retail lending balance to total credit balance has shown some fluctuations

In 2020, the ratio stood at 39.73%, indicating approximately two-fifths of BIDV Phu Tho's credit portfolio was allocated to retail lending This proportion increased to 44.82% in 2021, and further to 47.76% in 2022, before declining to 43.35% in 2023 This fluctuation suggests a degree of volatility in the bank's retail lending segment

Several factors could contribute to this fluctuating performance in retail lending Economic conditions, changes in consumer behavior, or shifts in the competitive landscape could all play a role Additionally, it is possible that increased competition from other financial institutions, changes in regulatory requirements, or shifts in customer preferences have influenced the effectiveness of BIDV Phu Tho's retail lending services.

Descriptive statistics of the survey sample

From 5 to 10 million Dongs/month 64 43.5

From 10 to 15 million Dongs/month 44 29.9

Medium term (from 1 year to 5 years)

In terms of gender, among the 147 customers responding to the survey, 87 were female, accounting for 59.2%, and the remaining 60 were male, accounting for 40.8%

As can be seen, while there are fewer male customers compared to females participating in the survey, the disparity between the two genders is relatively minor

Relating to age, statistics on the ages of candidates participating in the survey show that they have quite a diverse age range The customer group aged from 26 to 35 is 43 people, accounting for the highest proportion of 29.3% In second place, the group of customers aged from 36 to 45 years old has 33 people, accounting for 22.4% The group of customers aged from 46 to 55 ranked third and was only one customer behind second place with 32 people, equivalent to 21.8% Next is the group of customers from

18 to 25 years old, this group has 27 people, equivalent to 18.4% Finally, there is the group of customers over 55 years old with 12 people, accounting for 8.2% Thus, it can be said that this survey met the requirement of age diversity

With reference to occupation, the surveyed customers' careers are relatively diverse Specifically, there are 27 factory workers (18.4%), 25 businessmen (17.0%), 24 office staff (16.3), 21 students (14.3%), 20 public servants (13.6%), 16 farmers (10.9%),

In terms of income, there are many different average monthly income levels

Accounting for the largest number is the group of 64 customers with income from 5 to

10 million dong per month, accounting for 43.5% The group of customers with monthly income from 10 to 15 million dong is 44 people, equivalent to 29.9% Next, there are 30 customers with income over 15 million dong per month, the number of people in this group accounts for 20.4% The number of customers with monthly income under 5 million Dongs is quite different from the remaining groups, there are only 9 people with 6.1%

Regarding loan purposes, customers use loan capital for diverse purposes The highest number is the group of customers used for business, with 63 people, accounting for 42.9% 31 customers said that they used the loan for housing needs, this number accounted for 21.1% The number of customers with car loans and consumer loans without collateral is 22 people, equivalent to 15% The remaining 9 people borrowed money for the purpose of studying abroad, accounting for 6.1%

In terms of loan amount, we can see that customers' loan levels are quite diverse, depending on each individual's needs The number of customers borrowing over 200 million Dongs is the largest with 44 people (29.9%), ranked second is the group of customers who need to borrow from 100 to 150 million Dongs with 35 people (23.8%), followed by the group of customers who need to borrow from 150 to 200 million Dongs (23.1%), next are customers borrowing from 50 to 100 million Dongs with 20 people

(13.6%), and finally, the group of customers who need to borrow under 50 million dong has 14 people (9.5%)

With regard to loan period, the loan period of customers participating in the survey ranges from short-term to long-term loans The majority of customers with 81 people, equivalent to 55.1%, need medium term loans (from 1 year to 5 years), 36 people (24.5%) said they borrow money in the short term (under 1 year), finally 30 people, accounting for 20.4% borrow money in the long term (over 5 years)

In conclusion, the research demonstrates a notable absence of bias towards any particular customer demographic The investigation encompassed a diverse array of participants across various demographic categories, including genders, ages, occupations, income levels, loan purposes, loan amounts, and loan durations.

Cronbach’s Alpha coefficients

This part will use Cronbach's Alpha coefficient to assess the reliability of the customer satisfaction scale and the relationships between variables in each component This process ensures that the study works with a robust scale that accurately measures customer satisfaction

According to Nunally & Burnstein (1994), the criteria for evaluating scale reliability are as follows:

- Cronbach's Alpha reliability should exceed 0.6, with higher values indicating greater reliability

- Observed variables should have an Corrected item - Total correlation coefficient exceeding 0.3

Table 4.3: Reliability Statistics of Reliability Scale

(Source: Compilation based on SPSS version 20)

Table 4.4: Item-Total Statistics of Reliability Scale

Scale Variance if Item Deleted

Cronbach's Alpha if Item Deleted

The results of SPSS software version 20.0 assessments of Reliability scale show that the Cronbach's Alpha coefficient of this factor is 0.718 > 0.6, and the corrected item – total correlations are all items greater than 0.3 Therefore, these measurement variables are eligible for exploratory factor analysis in the next section

Table 4.5: Reliability Statistics of Responsiveness Scale

Table 4.6: Item-Total Statistics of Responsiveness Scale

The results in tables 4.4 and 4.5 show that the Cronbach's Alpha coefficient of

Responsiveness scale is 0.630, exceeding the recommended threshold of 0.6, and corrected item – total correlations of all items are greater than 0.3 Consequently, in the following section, these variables can be used for exploratory analysis

Table 4.7: Reliability Statistics of Assurance Scale

Table 4.8: Item-Total Statistics of Assurance Scale

The Cronbach's Alpha coefficient for 4 items in A scale is 0.884, surpassing 0.6, and the corrected item-total correlations of all items exceed 0.3 Consequently, these measurement variables meet the criteria for inclusion in the exploratory factor analysis in the subsequent section

Table 4.9: Reliability Statistics of Empathy Scale

Table 4.10: Item-Total Statistics of Empathy Scale

It can be seen that the Cronbach's Alpha coefficient for Empathy scale is 0.694, exceeding the 0.6 threshold Additionally, the Corrected Item - Total Correlation coefficients for E13, E15, and E16 all exceed 0.3 However, variable E14 exhibits a Corrected item - Total correlation of 0.279 falling behind the recommended threshold of 0.3 Consequently, E14 will be excluded, the remaining three variables of E scale eligible for exploratory factor analysis

Table 4.11: Reliability Statistics of Tangibles Scale

Table 4.12: Item-Total Statistics of Tangibles Scale

The results of SPSS assessments of Tangibles scale show a Cronbach's Alpha coefficient of 0.784 exceeding the threshold of 0.6, and corrected item-total correlations of T17, T18, T19, T20 all surpassing 0.3 It can be concluded that variables T17 to T20 meet the criteria for inclusion in the exploratory factor analysis in the following section

Table 4.13: Reliability Statistics of Loan products Scale

Table 4.14: Item-Total Statistics of Loan products Scale

The results of SPSS software version 20.0 assessments of Loan products scale show that Cronbach's Alpha coefficient of P scale is 0.702 surpassing the threshold of 0.6, and corrected item-total correlations of all items (P21, P22, P23) exceeding 0.3 Hence, these measurement variables qualify for exploratory factor analysis in the subsequent section

Table 4.15: Reliability Statistics of Customer satisfaction Scale

Table 4.16: Item-Total Statistics of Customer satisfaction Scale

The results in tables 4.15 and 4.16 indicate that Cronbach’s Alpha coefficients for the three items in S scale is 0.934 exceeding the 0.6 threshold, and all corrected item- total correlations surpassing 0.3 Therefore, these variables qualify for exploratory factor analysis.

Exploratory Factor Analysis

The research utilizes a measurement scale comprising 26 items for the independent variables Cronbach's Alpha coefficients of all these items indicated that there are 25 variables on the scale that are suitable for inclusion in the exploratory factor analysis Consequently, an exploratory factor analysis is conducted using these 25 variables to assess customer satisfaction with retail lending services at BIDV Phu Tho

Exploratory Factor Analysis is a method in exploratory data analysis employed to identify influential underlying factors or latent variables within a set of observed variables It forms the foundation for establishing a measurement model aimed at condensing or minimizing the number of observed variables loaded onto these factors

The statistical parameters utilized in exploratory factor analysis are as follow:

- The Kaiser-Mayer-Olkin (KMO) index is assessed to ascertain the suitability of conducting exploratory factor analysis A KMO index falling within the range of 0.5 to

1 is deemed appropriate for the analysis

- The Bartlett's test is employed to evaluate the hypothesis of non-correlation among variables within the population If the Bartlett's test is statistically significant (sig Bartlett’s Test < 0.05), the observed variables are correlated with each other

- The Eigenvalue serves as a commonly used criterion for determining the number of factors retained in EFA analysis Only factors with Eigenvalues exceeding 1 are retained in the analytical model

- Total Variance Explained indicates how well the factors identified in the analysis explain the variability present in the observed variables A value of 50% or higher signifies the adequacy of the EFA model

- Factor loading represents the correlation between observed variables and factors Hair et al (2010) indicates that while a minimum factor loading is 0.3, consideration of sample size to choose the most suitable factor loading is recommended For instance, in a study with a sample size ranging from 120 to 150, a loading factor of 0.5 is deemed appropriate In the context of this research, factor analysis is utilized to identify the most representative factors The study focuses on analyzing factors that significantly influence the quality of retail lending services The extraction method used is the principal components analysis with rotation for maximum variance (varimax) Given a sample size of 147, a loading factor of 0.5 was chosen

4.4.1 The first EFA for independent variables

Table 4.17: KMO and Bartlett's Test for independent variables

Kaiser-Meyer-Olkin Measure of Sampling Adequacy .869

KMO = 0.869 > 0.5, sig Bartlett's Test = 0.000 < 0.05, so exploratory factor analysis is appropriate

Extraction Method: Principal Component Analysis

Rotation Method: Varimax with Kaiser Normalization

However, as can be seen the loadings of factors REL3, REL5, RES7, P22, and P23 in the Rotated Component Matrix were all below the threshold of 0.5 Consequently, it is recommended that these factors be excluded from further analysis As a result, it is necessary to repeat the process for a second iteration

4.4.2 The second EFA for independent variables

Following the removal of 5 adverse variables, out of the initial 22 independent variables in the first EFA, 17 observed variables were retained for the subsequent second exploratory factor analysis

Table 4.19: KMO and Bartlett's Test for independent variables

As shown in Table 4.18, KMO is 0.858 ((0.5 ≤ KMO ≤ 1), sig of Bartlett's Test is 0.000 < 0.05, therefore, exploratory factor analysis is appropriate

Initial Eigenvalues Extraction Sums of Squared Loadings Total % of

(Source: Compilation based on SPSS version 20) Table 4.21: Rotated Component Matrix

As can be seen in table 4.20, there are 5 factors extracted based on the criterion of Eigenvalue greater than 1 These 5 factors best summarize the information of 17 independent observed variables included in the second exploratory factor analysis Cumulative extraction sums of squared loadings is 66.540% > 50%, which meets the requirements Hence, the 5 extracted factors explain 66.54% of the data variation of 17 observed variables participating in the exploratory factor analysis

The rotated component matrix results in table 4.21 show that the 17 observed variables are divided into 5 factor groups, all observed variables have factor loadings exceeding 0.5, thereby no factors were excluded from the analysis Five new factor groups are as follow:

Factor group 1 includes the following variables:

- A9: The bank credit officers create confidence in you

- A10: The bank credit officers address the matters accurately

- A11: The bank credit officers always demonstrate courtesy towards you

- A12: The bank credit officers adhere to professional ethics

Therefore, component 1 is named “Assurance”, and coded as F1

- T19: The bank has modern equipment

- T17: The bank is conveniently positioned

- T18: The bank's transaction location is beautifully decorated

- T20: The bank credit officers dress politely

- P21: The bank offers a diverse range of loan products

Therefore, component 2 is named “Tangibles and Loan products”, and coded as F2

- REL1: The bank fulfills its commitments accurately

- REL2: The bank always satisfactorily addresses customer complaints

- REL4: The bank always provides retail lending service on time as promised Therefore, component 3 is named “Reliability”, and coded as F3

- E13: The bank has policies that demonstrate care for you

- E16: When you face challenges, the bank always provides appropriate solutions

- E15: The bank credit officers always understand your needs

Therefore, component 4 is named “Empathy”, and coded as F4

- RES8: The bank credit officers work quickly

- RES6: The bank credit officers never seem too busy when you ask for help Therefore, component 5 is named “Responsiveness”, and coded as F5

Table 4.22: KMO and Bartlett's Test

The results show that KMO is 0.733 (0.5 ≤ KMO ≤ 1), and sig = 0.000 < 0.05 Therefore, it can be concluded that the observed variables are correlated with each other in the factor

Initial Eigenvalues Extraction Sums of Squared Loadings Total % of

As can be seen, there is one factor extracted at Eigenvalue equal to 2.666 > 1 This factor explains 88.877% of the data variation of the 3 observed variables participating in the exploratory factor analysis

Table 4.24: Rotated Component Matrix a Only one component was extracted The solution cannot be rotated

The results in Table 4.24 indicate that among the observed variables included, only one factor was extracted It suggests that the scale guarantees unidimensionality, with the observed variables of the dependent variable demonstrating convergence.

Model testing and multiple regression

According to the results of previous EFA, the customer satisfaction scale for retail lending services at BIDV Phu Tho is adjusted and divided into 5 new components which are: Assurance, Tangibles and loan products, Reliability, Empathy, Responsiveness Therefore, the research model is also modified as shown in figure 4.1, and the hypotheses are adjusted as follows:

HA0: All factors including Assurance, Tangibles and Loan products, Reliability, Empathy, Responsiveness cannot be used to measure customer satisfaction

HA01: Assurance has a positive impact on customer satisfaction

HA02: Tangibles and Loan products have a positive impact on customer satisfaction

HA03: Reliability has a positive impact on customer satisfaction

HA04: Empathy has a positive impact on customer satisfaction

HA05: Responsiveness has a positive impact on customer satisfaction

(Source: Self-synthesis) Figure 4.1: Adjusted research model

And the research model after adjustment will be as follows:

4.5.2 Research model and hypothesis assessment

In this section, regression analysis is used to evaluate the influence of each factor on customer satisfaction The results of regression model testing are shown in the following tables:

Adjusted R Square Std Error of the

HA1 HA2 HA3 HA4 HA5

The R Square statistic serves as a measure of model fit, with values exceeding 50% indicating an appropriate model Higher R Square values denote a stronger relationship between the independent factor and dependent factor

In Table 4.25, an R Square value of 0.690 (>0.05) suggests an appropriate model with a relatively strong relationship between independent factors and dependent factor Additionally, the adjusted R Square value is smaller than R Square value According to Pham Loc (2019), it implies they are suitable for reliably assessing the model suitability, as they do not exaggerate the model fit

The regression analysis reveals an R Square value of 0.690, indicating that 69.0% of the total variance in variables can be explained by the model The adjusted R Square value of 0.679 suggests that 67.9% of the change of the dependent variable is influenced by included independent variables, with the remaining 32.1% attributed to external factors and random errors This supports the existence of a linear regression model between Customer Satisfaction and the five scale components

Furthermore, the Durbin-Watson value of 1.711 falls within the range of 1.5 to 2.5, indicating no violation of the first-order series autocorrelation assumption (Yahua Qiao, 2011)

Total 146.000 145 a Dependent Variable: S b Predictors: (Constant), F5, F4, F3, F2, F1

(Source: Compilation based on SPSS version 20) The sig of ANOVA of 0.000 (< 0.05), thereby leading to the rejection of the hypothesis HA0

The following table represents the synthesis of the hypothesis testing results

HA0: All factors including Assurance, Tangibles and Loan products, Reliability, Empathy, Responsiveness cannot be used to measure customer satisfaction

HA01: Assurance has a positive impact on customer satisfaction Acceptable HA02: Tangibles and Loan products have a positive impact on customer satisfaction

HA03: Reliability has a positive impact on customer satisfaction Acceptable HA04: Empathy has a positive impact on customer satisfaction Acceptable HA05: Responsiveness has a positive impact on customer satisfaction

It can be concluded that the multiple linear regression model exhibits statistical significance, effectively fits the dataset, and is suitable for assessing customer satisfaction

4.5.3 The regression coefficients in the model

The results of table 4.28 below show that all 5 variables F1, F2, F3, F4, F5 have sig equal 0.000 which are less than 0.05, so these variables all affect the dependent variable S The Beta regression coefficients of these independent variables are all positive Therefore, hypotheses HA01, HA02, HA03, HA04, HA05 are accepted, the independent variables have a positive impact on the dependent variable And the regression equation is built as follows:

(In which, S: Customer satisfaction; F1: Assurance; F2: Tangibles and Loan products;

The regression equation shows that F1 has the largest Beta coefficient of 0.505 which means service capacity of staff has the highest level of influence on customer satisfaction When a customer's rating with this factor group goes up by 1 point, their satisfaction grows by 50.5% Therefore, the bank needs to pay special attention to the service capacity of its credit officers; thereby increasing the ability of the employees to create trust with clients, perform work accurately, serve customers politely, and comply with professional ethics

F2 and F4 have Beta coefficients of 0.488, 0.329 respectively This result means that if customers rate each factor of these two factor groups 1 point higher, their satisfaction increases by 48.8% and 32.9% each Hence, the bank needs to focus on investing in equipment, facilities, employee uniforms, diversifying the loan products as well as fulfilling its commitments to improve their satisfaction

The remaining two factor groups, F5 and F3, have the lowest Beta coefficients, coefficients of 0.231 and 0.190, corresponding to F5 and F3, individually Thus, if customers rate F5 1 point higher, their satisfaction will increase by 23.1% Similarly, when F3 is evaluated by customers by 1 point, their satisfaction will rise by 19.0% As a result, the bank should implement policies that show concern for its clients while also satisfying their demands for prompt, enthusiastic service

In conclusion, the results of multiple linear regression analysis show that each component has a different level of influence on customer satisfaction Among them, two factor groups F1 and F2 have the greatest influence This result is the foundation for proposing recommendations to improve customer satisfaction of retail lending services at BIDV Phu Tho.

Determining the differences in sample groups

In order determine if there are differences in responses among respondents with different characteristics such as gender, age range, occupation, income, loan purpose, loan amount, and loan period, One-Way ANOVA results should be utilized The process of conducting One-Way ANOVA testing in SPSS involves two main steps:

- If Sig < 0.05, indicating a statistically significant difference in variance between the sample groups And the Welch test results in the Robust Tests table will be used to give comment

- If Sig > 0.05, suggesting no statistically significant difference in variance between the sample groups And the results of the F-test in the ANOVA table will be used to give comment

Since the variance between the sample groups in this study is not significantly different (Sig > 0.05), step 2 will employ the ANOVA table

- If Sig < 0.05, indicating a statistically significant difference between the sample groups

- If the Sig > 0.05, suggesting no statistically significant difference between the sample groups

Table 4.29: Results of One-Way ANOVA

The outcomes of the One-Way ANOVA analysis indicate that there is no statistically significant difference in satisfaction levels among customers with varying genders or loan terms This conclusion is drawn from observing that both the Sigs of the Test of Homogeneity of Variances and the ANOVA tests for these two variables exceed 0.05

However, upon considering the remaining control variables, such as age, occupation, income, loan purpose, and loan amount, it is evident that while all exhibit Sigs of Test of Homogeneity of Variances exceeding 0.05, their Sigs of ANOVA are less than 0.05 This discrepancy suggests a statistically significant difference in customer satisfaction among groups with different ages, occupations, income levels, loan purposes, and loan amounts (Detailed results are available in Tables A1 to A14 in the Appendices.)

Customer satisfaction on retail lending services of BIDV Phu Tho

Table 4.30: Customer satisfaction on Assurance

Coding Criteria Rating level (%) Mean score

A9 The bank credit officers create confidence in you

A10 The bank credit officers address the matters accurately

A11 The bank credit officers always demonstrate courtesy towards you

A12 The bank credit officers adhere to professional ethics

Regarding F1, the mean of the variables is extremely high, ranging from 4.18 to 4.33 Three of the variables - A9, A10, A11, have average levels of strong agreement, and the last variable, A12, likewise gains agreement Furthermore, the mean score of the Assurance factor stands at 4.26, representing the highest rating among the five factors influencing customer satisfaction with the retail lending services offered by BIDV Phu Tho It is evident that the majority of clients who respond to the survey find BIDV Phu Tho assurance in retail lending service to be very satisfactory

First, there was a large number of respondents with 57.8% agreeing and 32.7% totally agreeing that the bank credit officers create confidence in them Neutral opinions make only 9.5% of the total As can be observed, bank workers operate in a highly professional manner and are trusted by the majority of clients This is an accomplishment that requires ongoing promotion

Second, the majority of survey participants with 93.2% were satisfied, of which 57.8% of customers were satisfied, the remaining 35.4% were very satisfied with the bank's credit staff's ability to resolve problems correctly In addition, 6.8% of customers are not sure about the way bank credit officers solve problems The very high satisfaction index shows that accurate problem solving is BIDV Phu Tho strength

Thirdly, 4.1% of customers adopted a neutral stance regarding the assertion that bank employees consistently exhibit courtesy towards customers Meanwhile, a majority, comprising 58.5% of respondents, agreed with the statement, with an additional 37.4% fully endorsing it It can be said that the majority of customers using BIDV Phu Tho consumer loan services are served by staff with a polite attitude This is a good indication of the bank capacity to retain clients

Although a significant majority, comprising 87.7% of respondents, expressed confidence or very confidence in the professional ethics of bank credit officers, a notable 12.2% remained uncertain on this matter Upon cursory inspection, it is evident that bank staff members uphold professional ethics fairly well, winning over most clients This accomplishment should be upheld and encouraged However, the doubts among 12.2% of surveyed customers indicate a need for further improvement in ensuring a robust work ethic among bank employees It suggests that isolated instances of professional misconduct may still occur, necessitating continued efforts towards enhancing ethical standards

4.7.2 Customer satisfaction on Tangibles and Loan products (F2)

Table 4.31: Customer satisfaction on Tangibles and Loan products

T19 The bank has modern equipment

T17 The bank is conveniently positioned

T18 The bank's transaction location is beautifully decorated

T20 The bank credit officers dress politely

P21 The bank offers a diverse range of loan products

In terms of F2, surveyed customers are generally content with the equipment, location, decoration, staff attire, and diversity of loan products of the bank The variables mean range from 4.01 to 4.34, and the mean score of this factor ranks as the second highest among the five factors impacting customer satisfaction, with a mean value of 4.19, indicating that customers are satisfied with the factor of Tangibles and Loan products

The percentage of customers who took part in the survey satisfied and very satisfied with the modernity of the bank equipment are 70.1% and 26.5% respectively This outcome is in line with reality, BIDV Phu Tho is fully furnished with contemporary technology including automatic teller machines (ATMs), Cash Deposit Machines (CDMs), and advanced computer systems at transaction counters, free water stations

Regarding the location of the bank, up to 95.9% of respondents stated that the bank is conveniently located, of which 21.1% of surveyed customers expressed strong agreement with this statement This makes sense because BIDV Phu Tho is located in the center of Viet Tri city, Phu Tho province, and the roads connecting to the bank are all main routes

While 63.3% and 19.0% of surveyed customers respectively agreed and strongly agreed that the decoration of the bank transaction room is aesthetically pleasing, 17.7% of respondents expressed a neutral opinion This indicates that there may be areas in which the bank decoration should be enhanced to satisfy this segment of customers In reality, there is a notable absence of decorative elements such as ornamental plants or informational boards pertaining to incentive programs at the BIDV Phu Tho transaction location

Furthermore, the percentage of customers who positively evaluated the attire of bank employees stands at 95.9% Among them, 57.8% expressed agreement, and 38.1% expressed strong agreement These figures show that the outfit with the primary light blue color and simple, polite design has created a positive impression on clients This aspect exemplifies BIDV seriousness in maintaining standards and reinforcing brand identity through the implementation of uniform policies for employees This not only aids customers in recognizing the brand but also fosters a sense of trust in the institution

Finally, the diversity of loan products has garnered satisfaction and high satisfaction from 70.1% and 24.5% of surveyed customers, respectively This number is reasonable given that BIDV Phu Tho provides a full range of loan services catering to diverse customer needs, including home loans, car loans, overseas education loans, household business loans, and unsecured installment personal loans

Table 4.32: Customer satisfaction on Reliability

REL1 The bank fulfills its commitments accurately

REL2 The bank always satisfactorily addresses customer complaints

REL4 The bank always provides retail lending service on time as promised

The findings indicate that customers rate F3 from level 3 (neutral) to level 5 (strongly agree), with an average score ranging from 4.14 to 4.22 The mean score attributed to this factor is 4.18, positioning it as the third highest among the five factors identified as influencing customer satisfaction This suggests that none of the surveyed customers are dissatisfied with reliability of BIDV Phu Tho consumer loan services, with the majority being satisfied

Regarding REL1, a significant 96.6% of customers either agree or strongly agree with commitment fulfillment of the bank This high percentage of concurrence signifies the bank has done well in keeping its promises, which is crucial for customer retention Thus, the bank should maintain its commitment compliance

Furthermore, 70.1% of customers agree, and 24.5% completely agree that the bank satisfactorily resolved their complaints This indicates the bank's diligent approach to addressing customer complaints, it resolves them reasonably in most cases Therefore, the bank should sustain its focus on effectively addressing customer complaints

In addition, a significant number of customers believe that the bank consistently delivers services on time as promised A notable 94.5% of respondents either agree or strongly agree, with only 5.4% of respondents maintaining a neutral attitude towards the bank's punctuality This demonstrates that the bank places a high priority on timely loan services delivery The punctuality stands as a strong asset for BIDV Phu Tho, requiring continued maintenance and efforts to minimize any instances of delayed service to further develop the customer experience

Table 4.33: Customer satisfaction on Empathy

E13 The bank has policies that demonstrate care for you

E16 When you face challenges, the bank always provides appropriate solutions

E15 The bank credit officers always understand your needs

Regarding Empathy, customers provided ratings for this factor ranging from level

Discussion of research results in comparison with other researches

The results of the Cronbach's Alpha analysis conducted in Chapter 4 indicate that except for variable E14 in the Empathy component which is eliminated due to its low reliability, the remaining variables of Reliability, Responsiveness, Assurance, Empathy, Tangibles, Loan products components are accepted for assessing the customer satisfaction for retail lending services at BIDV Phu Tho However, during the data treatment using EFA, some variables such as REL3, REL5 of Reliability, RES7 of Responsiveness, and P22, P23 of Loan products were excluded due to their weak loading factors which are less than 0.5 Additionally, the factor P21 was loaded in a different group, which was then named Tangibles and Loan products based on the content of the factors As a result, the linear regression model included five factors: Assurance, Tangibles and Loan products, Reliability, Empathy, and Responsiveness Although the levels of impact may vary, these five factors were able to explain 67.9% of the impact on customer satisfaction for retail lending services of BIDV Phu Tho

In general, the findings of this study may align with certain studies but diverge from others outlined in the literature review, concerning the independent variables considered and the extent to which each factor influences customer satisfaction in the retail lending services of BIDV Phu Tho

For instance, Le Thi Thanh Giang's research titled “Factors affecting customer satisfaction with the quality of personal credit services at Techcombank Can Tho branch” identified several factors such as Reliability, Responsiveness, Assurance, Empathy, Tangibles, and Loan products These factors mirror those examined in this study Furthermore, the research of Ms Giang point outed Responsiveness and Assurance, Empathy, Reliability, Loan products as factors influencing customer satisfaction with personal credit services Similarly, this research identifies Assurance, Tangibles, Loan products, Reliability, Empathy, and Responsiveness as significant contributors to customer satisfaction

In the research conducted by Ha Nam Khanh Giao and Tran Hong Hai, titled

“Customer Satisfaction towards ATM Services: A Case of Vietcombank Vinh Long, Vietnam” (2014), a set of factors was examined, including Reliability, Responsiveness, Empathy, Assurance, Tangibles, Network, and Price While the core five factors of the SERVPERF scale align closely with those considered in this study, additional factors incorporated into the two studies are different Furthermore, apart from SPSS 20.0 software, Ha Nam Khanh Giao and Tran Hong Hai also utilized AMOS 20.0 software, a methodological distinction from this research Their findings indicate that Price, Network, Empathy, and Reliability significantly influence customer satisfaction with ATM card services at Vietcombank Vinh Long

In comparison to the research on “Analyzing factors affecting the quality of personal credit services at Vietnam Maritime Commercial Joint Stock Bank - Thanh Xuan Branch” conducted by Truong Thi Quynh Trang in 2021, the two studies share nearly the same independent variables for assessing customer satisfaction, except for the factor of Loan products which were not included in the research of Truong Thi Quynh Trang Both studies yielded similar results, indicating that the independent variables accounted for a significant portion of the impact on customer satisfaction The research conducted at MSB Thanh Xuan found that the independent variables explained 62.4% of the impact on customer satisfaction, while the research conducted at BIDV Phu Tho reported that the independent variables explained 67.9% of the impact This suggests that less than 40% of the impact can be attributed to factors other than the independent variables considered in the studies

The factor of Assurance holds the greatest influence in the linear regression model of this study This outcome aligns with the findings of Le Thi Thanh Giang (2016), where Assurance was identified as one of the independent variables impacting customer satisfaction However, it is noteworthy that in the research of Le Thi Thanh Giang, Assurance was integrated with another factor, and re-named Responsiveness and Assurance This finding contrasts sharply with the conclusions drawn by Ha Nam Khanh Giao and Tran Hong Hai, who concluded that "Assurance and Responsiveness" insignificantly affects the satisfaction of ATM card users at Vietcombank, as indicated by the results of Structural equation Modeling Analysis with a p-value of 0.057, surpassing the significance threshold of 0.05 The reason may be that ATM services' simplicity and users' emphasis on functionality and accessibility suggest that interpersonal factors like assurance have less impact Unlike face-to-face interactions in services like retail lending, ATM interactions are primarily automated, minimizing direct human involvement Consequently, attributes such as assurance, including competence and courtesy, which are vital in human interactions, might not greatly influence satisfaction with ATM services

In terms of Tangibles and Loan products

The factor of Tangibles and Loan products is an independent variable influencing customer satisfaction in this study However, it is important to acknowledge that this is a novel factor that emerged post-regression analysis, thus lacking a comparative basis with prior studies Nonetheless, upon examination of the composition of this factor, it becomes apparent that both Tangibles and Loan products individually contribute to customer satisfaction in previous research Truong Thi Quynh Trang's study indicates the impact of Tangibles on customer satisfaction, while Le Thi Thanh Giang's research show the impact of Loan products in shaping satisfaction levels

The findings regarding Empathy in this research align with those presented in the literature review, indicating its significance as a factor influencing customer satisfaction However, it is noteworthy that while Empathy may exert a considerable influence on customer satisfaction in this particular case, its impact might be less pronounced in others

In this study, Empathy ranks third in terms of impact, making up 32.9% of the total impact This third positioning parallels the findings of Ha Nam Khanh Giao et al

(2014) However, in Le Thi Thanh Giang's research, Empathy emerges as the second most influential factor on customer satisfaction, indicating a discrepancy in its relative importance across studies

Conversely, the research conducted by Truong Thi Quynh Trang (2021) presents a contrasting perspective In her study, Empathy is identified as one of the two factors with the least impact on customer satisfaction, accounting for only 16.6% of the total impact

In research of Truong Thi Quynh Trang, Responsiveness emerges as the least influential factor on customer satisfaction, accounting for only 9% of the total impact Similarly, in this study, Responsiveness is identified as one of the two factors with the weakest impact on satisfaction of customer using retail lending services of BIDV Phu Tho However, it is notable that the proportion of Responsiveness on the total impact of this study is 23.1%, much higher than Quynh Trang's study

In this research, this factor exerts the smallest influence on customer satisfaction, accounting for 19.0% of the total impact, which contrasts significantly with the most impactful factor, Assurance, at 50.5% This finding similar to Ha Nam Khanh Giao's

(2014) However, it diverges significantly from the results of Truong Thi Quynh Trang

(2021) and Le Thi Thanh Giang (2016) Trang's research identified Reliability as having the greatest impact on customer satisfaction, and Giang's study positioned it as the second most influential factor

Chapter 4 indicated the factors influencing customer satisfaction with the retail lending services of BIDV Phu Tho, along with their levels of influence Additionally, it assesses the degree of customer satisfaction with this service of BIDV Phu Tho The findings reveal that five components significantly impact customer satisfaction with retail lending services of BIDV Phu Tho, listed in descending order of influence: Assurance, Tangibles and Loan products, Empathy, Responsiveness, and Reliability Additionally, the level of customer satisfaction with these factors follows a descending order as follows: Assurance, Tangibles and Loan products, Reliability, Responsiveness, and Empathy.

CONCLUSIONS AND RECOMMENDATIONS

Summary of findings

The research outcomes indicate that customer satisfaction is influenced by five distinct factors: Assurance, Tangibles and Loan products, Reliability, Empathy, and Responsiveness Among these, Assurance demonstrates the most pronounced impact, while Reliability exhibits the least significant influence Additionally, the results indicate the impact of control variables such as age, occupation, income, loan purpose, and loan amount on customer satisfaction

Furthermore, the research findings reveal that although a considerable proportion of clients express satisfaction with the retail lending services of BIDV Phu Tho, there exist areas requiring improvement to enhance overall customer satisfaction Notably, a significant strength lies in the bank's efforts to cultivate a team of courteous credit officers, as evidenced by their amiable interactions with clients However, there are still instances of delays in credit officers' work performance, leading to dissatisfaction among some customers.

Conclusions

The thesis evaluates customer satisfaction regarding the retail lending services provided by BIDV Phu Tho, proposing solutions to address existing limitations and enhance service quality to attract more individual customers to the branch Overall, the research achieved its goals: identifying factors affecting customer satisfaction in retail lending at BIDV Phu Tho and how big they are and evaluating customer satisfaction with the branch's retail lending service

The research model and factors affecting the quality of personal customer lending services at BIDV Phu Tho are developed based on synthesizing previous studies and summarizing relevant models The scale reliability testing results indicate that all observed variables except variable E14 are suitable for further analysis and demonstrate relatively high reliability Exploratory factor analysis reveals five new factors extracted from the independent variables Following regression analysis, the factors influencing customer satisfaction are identified as Assurance, Tangibles and Loan products, Empathy, Responsiveness, and Reliability (arranged from highest to lowest influence) Additionally, customer satisfaction levels with these factors are ranked in descending order as follows: Assurance, Tangibles and Loan products, Reliability, Responsiveness, and Empathy.

Recommendations

Outlined below are the solutions intended to enhance the quality of retail lending services at BIDV Phu Tho, which also serve as one of the research objectives of the study:

This dimension exhibits the most profound impact on customer satisfaction and is highly valued by customers Consequently, BIDV Phu Tho should implement measures to further promote and enhance the service capabilities of its employees through the following actions:

Firstly, there is a need to specialize and elevate the quality of the team not only in terms of skills and professional qualifications but also in transactional demeanor and adherence to professional ethics Credit officers must possess comprehensive knowledge of the financial domain, master the bank's processes and regulations, understand and adhere to legal requirements

Secondly, it is imperative to conduct regular training sessions aimed at nurturing professional knowledge for credit departments, particularly focusing on young employees lacking in skills and newly recruited bank personnel This initiative aims to help employees thoroughly grasp the credit product range as well as their characteristics Additionally, alongside employee training, managers and leaders should regularly assess employees' knowledge and offer clear guidance to those requiring additional support

Finally, the bank should emphasize training in communication and customer persuasion skills It is necessary to open seminars to share experiences among employees, presenting challenging scenarios for problem-solving exercises, and implementing strategies to enhance qualifications and build trust with customers

In terms of “Tangibles and Loan Products”

Firstly, emphasis should be placed on enhancing the visual appeal of the bank transaction room For instance, incorporating informational standees showcasing new products or images depicting BIDV's activities within the transaction areas would prove advantageous This strategic approach is designed to captivate customers' attention to the bank's offerings and foster a comfortable atmosphere for transactions

Secondly, the bank should undertake a continual diversification of its loan products to accommodate a broad spectrum of customer needs By doing so, the bank can mitigate instances where there exists demand without corresponding supply, ensuring that it remains responsive to evolving customer requirements

Firstly, the bank should devise preferential policies for loyal customers with established relationships, such as offering assistance with notarization procedures, arranging document signings at customers' locations, or providing discounted service fees for frequent transactions This personalized approach enhances customers' emotional connection with the bank, subsequently elevating satisfaction levels

Furthermore, employees should attentively consider customers' emotions and proactively address their specific requirements By understanding individual customer needs, credit officers can offer tailored and optimal services, thereby fostering empathy and satisfaction

Primarily, to mitigate customer dissatisfaction regarding the speed of bank credit officers, BIDV Phu Tho should implement measures aimed at improving communication and transparency Enhancing communication between credit officers and clients is imperative This involves encouraging credit officers to offer clear explanations regarding processes and timelines, thereby keeping clients informed and reassured Besides, increasing transparency in the credit evaluation process is essential Providing clients with visibility into this process, including any potential delays, helps manage expectations effectively

Additionally, BIDV Phu Tho should enhance its responsiveness to phone calls by establishing a dedicated hotline for it, ensuring swift and accessible customer service Customers will perceive dedicated and thoughtful service positively, enhancing satisfaction levels Moreover, the bank should implement employee training programs focusing on effective phone and email communication to expedite and accurately address customer inquiries

Finally, staff members must possess a clear understanding of operational processes to efficiently guide customers in completing necessary documents promptly and accurately, thus mitigating prolonged procedural times that may lead to dissatisfaction

BIDV Phu Tho should prioritize accuracy and timeliness in transactions, ensuring that service delivery aligns with commitments made to customers Furthermore, periodic reassessment of service commitments is crucial to maintaining the reliability of the bank

Additionally, the bank should establish a highly accurate and transparent customer information storage system Regular updates to customer information are necessary to prevent instances where customers modify their information but the bank fails to record it promptly Moreover, customer information must be treated with utmost confidentiality, as it plays a pivotal role in fostering trust between customers and the bank

Chapter 5 encapsulated the primary discoveries unearthed throughout the study, encapsulating conclusive remarks and offering actionable recommendations to bolster the efficacy of retail lending services at BIDV Phu Tho These proposed recommendations stem directly from the empirical insights delineated in Chapter 4, aligning with a strategic approach to enhance operational quality and customer satisfaction within the institution's retail lending framework

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Table A1: Test of Homogeneity of Variances – Gender

Levene Statistic df1 df2 Sig

Sum of Squares df Mean Square F Sig

(Source: Compilation based on SPSS version 20) Table A3: Test of Homogeneity of Variances - Age

(Source: Compilation based on SPSS version 20) Table A4: ANOVA – Age

Table A5: Test of Homogeneity of Variances - Career

(Source: Compilation based on SPSS version 20) Table A6: ANOVA – Career

(Source: Compilation based on SPSS version 20) Table A7: Test of Homogeneity of Variances - Income

(Source: Compilation based on SPSS version 20) Table A8: ANOVA – Income

Table A9: Test of Homogeneity of Variances – Loan purpose

(Source: Compilation based on SPSS version 20) Table A10: ANOVA – Loan purpose

Sum of Squares Df Mean Square F Sig

(Source: Compilation based on SPSS version 20) Table A11: Test of Homogeneity of Variances – Loan amount

(Source: Compilation based on SPSS version 20) Table A12: ANOVA – Loan amount

Table A13: Test of Homogeneity of Variances – Loan period

(Source: Compilation based on SPSS version 20) Table A14: ANOVA – Loan period

Sum of Squares Df Mean Square F Sig

Tiêu đề	Customer Satisfaction for Retail Lending Services
Tác giả	Duong Thi Thu Huyen
Người hướng dẫn	Dr. Can Thuy Lien
Trường học	Banking Academy of Vietnam
Chuyên ngành	Foreign Languages
Thể loại	Graduation Thesis
Năm xuất bản	2024
Thành phố	Hanoi

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Số trang	94
Dung lượng	1,12 MB