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1 DOI / Studying the impact of electronic service quality on customer satisfaction in the banking industry (Case Study: Bank Refah Kargaran, Khuzestan) Abolfazl khouraki 1, Leila andervazh 2* 1 Department of Business Management, Persian gulf International Branch, Islamic Azad University, khoramshahr, Iran, 2* Department of Business Management, Persian gulf International Branch, Islamic Azad University, Khoramshahr, Iran Received: 19 th Jan 2017, Accepted: 25 th Jan 2017, Published: 15 th April 2017 Abstract As the first step, this study aims at examining the relationship between dimensions of service quality received and customer satisfaction, and then in the second step, it tries to examine the effects of customer satisfaction on behavioral intentions (purchase, change, and complaint intentions). The study is applied in terms of purpose, and considering method, it is descriptive, correlational, and survey. Through systematic classification sampling, a sample of 384 was selected for data collection. Structural-equation test result shows that the dimensions of quality of services received (reliability, responsiveness, trustworthiness, empathy, and physical factors) have a significant positive relationship with customer satisfaction. Moreover, customer satisfaction has a significant positive relationship with intention to purchase and a negative significant relationship with intention to change and complaint. Key Words: service quality, customer satisfaction, intention to purchase, intention to complaint, intention to change, e- banking Introduction The advent of information technology has brought about structural changes in the banking system that has led to tendency towards remote banking systems. Several paths have been opened to provide services to customers. The most frequently used paths in banking are respectively ATM banking, internet banking, telephone banking and mobile phone banking (Wan et al., 2003). The World Wide Web has profoundly changed the customers' expectations in terms of speed, accuracy, price, and service. Geographical distance has lost its meaning and accessibility, ease, and speed of service delivery create competitive advantage for organizations, including the banks. Businesses have to offer the newest and most attractive services to their customers as the customers demand to compete in this complex environment. For the survival of the banks in the competition, bank branches need to change traditional banking methods. Customer preferences and interests in a wide range of products and services are based on a new form of internet, competition based on cost-reduction, customer 1263 Copyright 2016 Helix ISSN (Online) retention, promoting customer, customer admissibility, security, and ease of use (Change, 2010). In fact, today, banking industry is not limited only to services behind the counter, but its activity scope has extended into multinational corporations. Nowadays, banks enter into electronic trading system, as major investors, in the exchange market and in competition with other banks play a major role in financing, and monetary and economic wellbeing of their society (Abasinejad, 2009). Banks offer similar services with similar cost to customers everywhere, so in order to make their services distinguished from other banks', bank managers look to increase the quality of their service (Ghazizadeh et al., 2010). Quality of service is closely related to customer satisfaction in the banking industry (Avkiran, 1994). Improving service quality increases the probability of customer satisfaction, which leads to behavioral outcomes such as commitment, desire to remain, creating bidirectional links between the service provider and the customer, increase of customer's tolerance to problems in providing services, and positive publicity about the bank (Arasli et al., 2005). Therefore, in this study, we study the effect of electronic services quality on customer satisfaction in banking industry. Review of literature The quality of service Parasuraman et al. (1988) have provided a comprehensive definition of service quality: Service quality is a form of attitude connected with satisfaction, but not equal to it, obtained from comparison between customer expectations of services and service performance. In fact, it can be argued that there is always a gap between customer expectations and performance of service provider, which is indicative of the quality of services provided. In other words, the measurement of service quality is the difference between the provider performance and customer expectations. The importance of service quality in banks In all service industries, service quality has been taken into consideration as a fundamental issue for the competitiveness on the market. Since financialservice provider organizations, especially banks, are working in an environment with undifferentiated

2 products, the quality of services is known as the primary weapon for competition. In this regard, some experts believe that competitiveness in bank comes exclusively from service quality. In general, banks superior in quality of service have a separate market because top-level quality of service is connected to more income, more preserving of customers, and more market share. If banks regularly inquire about the problems of their clients, the quality will dramatically improve. Dealing with complaints involves many direct and indirect calls for banks, but since these complaints include direct voices of customers, they provide valuable knowledge in them that can be used to improve the quality. Discussion over the nature of quality and the relationship between expectations, notions, customer satisfaction, and services provided is of the fundamental problems in the assessment of service quality in the public sector. Litnom has defined quality of service as a three-dimensional structure, which contains interactions inside, physical factors, and contribution to the quality aspects. Dekin and Walsh reported that there is a significant relationship between customers, who receive the services, and service providers and this relationship is vulnerable. Considering the issues discussed above, we can conclude that to compete in today's rapidly changing environment, banks have to pay special attention to the quality of their services. This will bring about more retention of customers, attracting new customers, and improving financial performance and profitability (Molavi and Eskandari, 2012). The concept of electronic services Electronic services (e-services) can be defined as a web-based service or services delivered interactively on the Internet. Electronic concept refers to interactive information services. Zithamel et al. defined e-services as services delivered via the Internet (Bruce Ho & Lin, 2010). Importance and necessity of achieving customer satisfaction Research has shown that 96% of customers never complain of bad behavior and bad quality of goods and services, but 90% of these customers who are dissatisfied do not return to repurchase. Each dissatisfied customer share his discomfort with at least 7 to 9 people and attracting a new customer is 5 to 7 times more costly than maintaining the current ones. This is the company's success, so it can be concluded that in order to have success, companies must have satisfied clients (Taleghani et al., 2013). Typically, provision of customer satisfaction, especially in the area of services, depends on the quality of service delivery. Thus, research on evaluating the quality of services provided to customers has grown immensely over the past two decades (Azizi, 2008). Electronic satisfaction Electronic satisfaction is the rate of customer satisfaction with the support for sending and receiving orders for goods or services, after-sales services, the price of goods or services, quality of website content, website speed, the reliability of the website, the ease of use of the website, and security. Electronic satisfaction means customer satisfaction according to previous purchase experience from an enterprise of electronic commerce. Electronic satisfaction means preferring goods or services of one electronic firm rather than competitors while purchasing (Javanmard and Mardani, 2010). Figure 1: The conceptual model Salim et al. (2015) and Carvalho, San, Motta and Lima (2010)) Research Hypotheses 1. Physical factors of electronic-service quality have a significant positive effect on satisfaction of Bank 2. Trustworthiness of electronic-service quality has a significant positive effect on satisfaction of Bank 3. Accountability of electronic-service quality has a significant positive effect on satisfaction of Bank 4. Reliability of electronic-service quality has a significant positive effect on satisfaction of Bank 5. Sympathy of providers of electronic-service quality has a significant positive effect on satisfaction of Bank Refah Kargaran customers in Khuzestan. 6. Customer satisfaction has a significant positive effect on customers' purchase intention from electronic services of Bank Refah Kargaran customers in Khuzestan. 7. Customer satisfaction has a significant positive effect on customers' complaint intention from electronic services of Bank Refah Kargaran customers in Khuzestan Copyright 2016 Helix ISSN (Online)

3 8. Customer satisfaction has a significant positive effect on customers' exchange intention from electronic services of Bank Refah Kargaran (BRK) customers in Khuzestan. Methodology The study is applied in terms of purpose, and considering method, it is descriptive, correlational, and survey. Population consists of 384 customers of BRK in Khuzestan. In this study, a questionnaire with 32 items was distributed among the samples to collect data. Cronbach alpha coefficient for the questionnaire was calculated that was Data analysis Factor loading The significance of the relationship between factors (latent variables) and visible variable factor is shown by factor loading. Factor loading is a value between zero and one. If the factor loading is less than 0.3, the relationship is insignificant and it will be discarded. Factor loadings between 0.3 and 0.6 are acceptable, and if it is greater than 0.6, it is very desirable. In this section, factor loadings related to the variables of the research model, given in Figure 2.4, are examined. Factor loadings deal with the relationship between latent and variable variables. On the other hand, factor loading equal to for the observed variable Ha1 means that about 0.63 ( ) of the variance of hidden variable sympathy is expressed by Ha1. Factor loadings for all observed variables are good, that is more than 0.3. Table 1: Factor loadings of the observed variables Variables Main aspects Items Service quality Customer satisfaction Behavioral intentions Factor loading Physical Ph Ph Ph Ph Et Et Trustworthiness Et Et Et Pa Accountability Pa Pa Pa Etm Reliability Etm Etm Etm Ha Ha Sympathy Ha Ha Ha Rez Rez Rez Gk Purchase Gk intention Gk Change intention GT Complaint intention GS GS GS As has been stated, to test the hypothesis, Smart-PLS software has been used. As seen in Figure 3, all the hypotheses are confirmed because all t values are higher than the standard value of absolute value Figure 2: Factor loading and path coefficients in measurement model In Table 1, factor loadings of the observed variables are given Copyright 2016 Helix ISSN (Online)

4 Figure 3: t values - tested version The first hypothesis The results show that the physical factors of quality of customer satisfaction have a significant positive effect equal to As the significance value (7.996) is outside the range ±1.96 and its sign is The second hypothesis The results show that trustworthiness of quality of effect equal to As the significance value (5.713) is outside the range ±1.96 and its sign is The third hypothesis The results show that accountability of quality of effect equal to As the significance value (2.262) is outside the range ±1.96 and its sign is The fourth hypothesis The results show that reliability of quality of effect equal to As the significance value (5.153) is outside the range ±1.96 and its sign is The fifth hypothesis The results show that sympathy of quality of effect equal to As the significance value (2.635) is outside the range ±1.96 and its sign is The sixth hypothesis addition to connection with purchase intention of a significant positive effect equal to As the significance value (3.485) is outside the range ±1.96 and its sign is The seventh hypothesis addition to connection with complaint intention of a significant positive effect equal to As the significance value (15.030) is outside the range ±1.96 and its sign is negative, this hypothesis is confirmed. The eighth hypothesis addition to connection with change intention of a significant positive effect equal to As the significance value (3.766) is outside the range ±1.96 and its sign is negative, this hypothesis is confirmed. Table 2: Summary of the results of testing hypotheses Conclusion The first hypothesis The results show that the physical factors of quality of customer satisfaction have a significant positive effect equal to As the significance value (7.996) is outside the range ±1.96 and its sign is This result is The second hypothesis The results show that trustworthiness of quality of effect equal to As the significance value (5.713) is outside the range ±1.96 and its sign is This result is 1266 Copyright 2016 Helix ISSN (Online)

5 The third hypothesis The results show that accountability of quality of effect equal to As the significance value (2.262) is outside the range ±1.96 and its sign is This result is The eighth hypothesis addition to connection with change intention of a significant positive effect equal to As the significance value (3.766) is outside the range ±1.96 and its sign is negative, this hypothesis is confirmed. This result is consistent with the results of the studies by Sharma, Motahaver, and Havan (2009), Carvalho, San, Motta and Lima (2010), and Salim et al. (2015). The fourth hypothesis The results show that reliability of quality of effect equal to As the significance value (5.153) is outside the range ±1.96 and its sign is This result is The fifth hypothesis The results show that sympathy of quality of effect equal to As the significance value (2.635) is outside the range ±1.96 and its sign is This result is The sixth hypothesis addition to connection with purchase intention of a significant positive effect equal to As the significance value (3.485) is outside the range ±1.96 and its sign is positive, this hypothesis is confirmed. This result is consistent with the results of the studies by Sharma, Motahaver, and Havan (2009), Carvalho, San, Motta and Lima (2010), and Salim et al. (2015). The seventh hypothesis addition to connection with complaint intention of a significant positive effect equal to As the significance value (15.030) is outside the range ±1.96 and its sign is negative, this hypothesis is confirmed. This result is consistent with the results of the studies by Sharma, Motahaver, and Havan (2009), Carvalho, San, Motta and Lima (2010), and Salim et al. (2015) Copyright 2016 Helix ISSN (Online) Research suggestions 1. The research findings indicate that physical factors are of utmost importance in customers' perceptions of the quality of services provided by the bank to enhance customer satisfaction. Therefore, the organization can improve its infrastructure in information technology and use new technology to provide optimal service to customers, thus differentiate itself from competitors and improve their consent. 2. Research findings show that customers' increased confidence in e-banking plays an important role in customer satisfaction. By improving and enhancing network security, banking system, and guaranteeing non-stealing of customers' data, managers can increase this dimensions of service quality. 3. The findings show that accountability aspect of quality of services in the field of electronic banking brings about customer satisfaction. By setting up accountability networks, managers can identify and remove ambiguities and meet customers' needs and requirements. 4. The results show that the ultimate goal of any business from marketing plans is to strengthen its ability in positive effect on the behavior of consumers. One of the three reactions that the consumer may show in dealing with business is to refer to the intended organization to purchase; this means if satisfied, they will not abandon the organization. Second, due to lack of consent with the shop, they show complain and express their objection to the managers. The third scenario is if their complaint is not dealt with logically by the organization, they will change their shopping center, and may even change it without complaint and protest. Therefore, managers should make serious efforts to achieve customer satisfaction, and for this purpose, pay attention to every effective aspect in improving e- banking service quality. 5. Banks provide financial services to customers. Customers pay attention to the quality of services provided by the banks for future judgments and decisions about them. In addition, since the results show that perceived service quality by the bank is of great importance to consumers, BRK managers are recommended that pave the way to provide proper services to the customers by in-

6 service and pre-service training to the staff, as well as improving the working conditions of their employees that are directly in contact with customers. References 1. Abasinejad, M. (2009), Identifying factors affecting the quality of online services in the adoption of e-business models, Fifth International Conference on Information and Communication Technology Management 2. Molavi, Z, and Eskandari, K. (2012). Explaining the need for high quality electronic services in electronic banking, banks and the economy, Issue 120, pp Taleghani, M. Fallahchai, S.M. Yazdan Bakhs Ghodsian, M. (2013) The effect of quality of e- banking services on increasing levels of customer satisfaction and loyalty, the National Conference of modern management science, pp, Azizi, Sh. (2008). Buy subtle: a tool for measuring the quality of services, Tadbir Publication, No. 196, pp, Javanmard, H.A. Mardani, A. (2010). The impact of electronic service quality and customer satisfaction in online purchases books on behavioral intentions, Iran Petrochemical Commercial Company, research management, Issue 3, pp, Ghazizadeh, M., Besheli, A. S., & Talebi, V. (2010). Assessing of bank customers retention and loyalty: A case study of state owned Banks in Tehran. European Journal of Social Science, 17, Arasli, H., Katircioglu, S., & Samadi, S. (2005). 8. Comparison of service quality in the banking industry, some evidence from Tuskish- and Greekspeaking areas in Cyprus. International Journal of Bank Marketing, 23, Wan, W., Luk, C., & Chow, C. (2003). Customer's adoption of banking channels in Hong Kong. International Journal of Bank Marketing, 23, Chang, B. Y. &Faziharudean, T. M. (2010). Factors 11. Affecting Customer Loyalty of 12. Parasuraman, A. Zeithanl, V.A, Berry, L.L. (1988). Servqual: A multiple item scale for measuring consumer perceptions of service quality, Journal of Reatailing, 64(1): Bruce Ho, C.T, Lin, w.ch. (2010). Measuring the service quality of internet banking: scale development and validation, Journal of European Business Revirw, 22(1): Copyright 2016 Helix ISSN (Online)