Perceived Service Quality and Customer Loyalty: Evidence from Commercial Banks in Sri Lanka

Service quality plays an important role in any organization in order to achieve competitive advantage. For banks, service quality is considered as central to their business since it affects the customer’s inclination to deal or not to deal with the bank anymore. In this regard, there was a need to investigate the link between the constructs of perceived service quality and customer loyalty. For this purpose, commercial banks in Sri Lanka were identified using univariate and bivariate analysis. As per data analyzed, it was revealed that there was a positive strong correlation existing between perceived service quality and customer loyalty at commercial banks in Sri Lanka. Moreover, all dimensions of perceived service quality had the positive relationships with customer loyalty. However, the dimensions of reliability and assurance showed a higher correlation than other dimensions. Thus, the findings emphasized the banks to highly engage in increasing service quality and customer loyalty. The future researchers may look into the constructs in different areas and with different measurement of instruments.