ASSOSA UNIVERSITY

COLLEGE OF BUSINES AND

ECONOMICSDE

DEPARTMENT OF ACCOUNTING AND FINANCE

ASSESSMENT OF FACTORS THAT AFFECT CUSTOMERS’

PREFERENCE AMONG BANKS
(A CASE OF ASSOSA TOWN)

A RESEARCH PAPER PROPOSAL SUBMITTED IN PARTIAL FULFLIMENT FOR

THE REQUIREMENTS OF (BA) DEGREE IN ACCOUNTING AND FINANCE

By:
1. Mulugeta Funte.......................BER/2152/08
2. Million Berhe...........................BER/2135/08

ADVISOR:, GEDION F. (MBA) Assosa, Ethiopia

May January, 2018

i|Page
 Abstract
This study wa is conducted at Assosa town which is located in the western part of Ethiopia,
under the title of “Assessment of factors that affects customers’ preference among banks:
in A case of Assosa town.” Bank is an organization while investors, bank employees, local
communities and government are some of the customers of banks., Since b Banks
rendered different services to their customers like saving account, current account, time
deposits, over draft facilities, term loans and transfer both local and foreign currencies.
This investigation The purpose of the study was was conducted to find out the necessary
information in Assosa town about factors that contribute for customers’ preference among
banks customer preference among the banks exist in Assosa town. The general objectives of
the study was to identify the facility that contribute the base for customers preference among
banks, and i Its result is helpful for both the banks and customers to identify factors that
reduce customers’ interest towards them and forward feasible recommendations in order to
solve the problems. To attain the main objectives of the study primary source of data was
collected with the help of structured questionnaires. The sample was drawn from specified
banks.

Add keywords

ii | P a g e
Acknowledgements ?

If you make substantial changes to the work both on the proposal and on the first draft
as a result of my comments, then it would be appropriate to acknowledge my
contribution in your final draft. This is not because I want to be acknowledged, but to
maintain ethical standards of research report writing.

Table of Contents. Page no

Abstract................................................................................................................................................ii
CHAPTER ONE..................................................................................................................................1
INTRODUCTION...............................................................................................................................1
1.1General Background of the Study.................................................................................................1
1.2 Statement of the Problem.............................................................................................................2
1.3 Research Questions......................................................................................................................3
1.4 Objective of the study..................................................................................................................3
1.4.1 General Objectives................................................................................................................3
1.4.2 Specific Objectives...............................................................................................................3
1.5 Significance of the Study.............................................................................................................3
1.6 Limitations of the Study..............................................................................................................3
1.7 Scope of the Study.......................................................................................................................3
1.8Organization of the study..............................................................................................................4
CHAPTER TWO.................................................................................................................................4
LITERATURE REVIEW...................................................................................................................4
2.1 Concepts and Definitions of a Bank............................................................................................4
2.2 Emergence and Development of Banking Institutions.................................................................5
2.3 Types of Banks............................................................................................................................6
2.3.1 Commercial Banks................................................................................................................6
2.3.1.1 Exchange Banks.................................................................................................................7
2.3.1.2 Industrial Banks.................................................................................................................7
2.3.2 Agricultural bank..................................................................................................................7
2.3.3 Cooperative Banks:...............................................................................................................7
.2.3.4 saving Banks........................................................................................................................7
2.3.5 Central Bank.........................................................................................................................7

iii | P a g e
 2.4 Function of commercial Banks....................................................................................................8
2.4.1 Accepting Deposits........................................................................................................8
2.4.2 Advancing loans...................................................................................................................8
2.4.2.1 Cash credit.........................................................................................................................8
2.4.2.2 Call loans...........................................................................................................................8
2.4.2.3 Over draft:..........................................................................................................................8
2.4.2.4 Discounting bills of exchange............................................................................................9
2.4.3. Credit creation.....................................................................................................................9
2.4.4. Financing foreign trade........................................................................................................9
2.4.5. Agency service.....................................................................................................................9
2.4.6. Miscellaneous service..........................................................................................................9
2.5THEORETICAL RIVIEW LITERATURE..............................................................................9
2.5.1 Bank selection criteria........................................................................................................9
2.5.1.1 Bank Services....................................................................................................................9
2.5.1..2 Third Party Influences.....................................................................................................10
2.5.1.3Electronic Services...........................................................................................................10
2.5.1.4 Financial Benefit (Interest rates)......................................................................................10
2.5.1.5 Personal relation..............................................................................................................10
2.5.1.6 Marketing Communication:.............................................................................................11
2.5.1.7 Convenience:...................................................................................................................11
2.6 EMERICAL LITRATURE REVIEW........................................................................................11
CHAPTER THREE...........................................................................................................................13
Methodology for the Study...............................................................................................................13
3.1 Research design.........................................................................................................................13
3.2 Target population.......................................................................................................................14
3.3 Source of data............................................................................................................................14
3.4 Data collection Instrument.........................................................................................................14
3.5 Sampling Technique..................................................................................................................15
3.6Sample size.................................................................................................................................15
3.7. Data processing and Analysis...................................................................................................16
CHAPTER FOUR...........................................................................................................................16
4. DATA ANALYSIS, INTERPRETATION AND PRESENTATION.........................................16
4.2 Knowledge of customers for the service that are given by the bank......................................18
4.3 Types of services given by the bank to the customers............................................................19

iv | P a g e
 4.4 Customer preference of bank for the services given..............................................................20
4.5 Factors Affecting Bank preference........................................................................................23
4.6 suggestions of Respondents for improving the service given by the bank.............................25
CHAPTER FIVE...............................................................................................................................26
5. SUMMARY OF FINDING, CONCLUSION...............................................................................26
AND RECOMMENDATION...........................................................................................................26
5.1Summary of Finding.................................................................................................................26
5.2. Conclusions.............................................................................................................................27
5.3. Recommendation....................................................................................................................28
REFERENCE....................................................................................................................................29
APPENDEX.......................................................................................................................................31

v|Page
 CHAPTER ONE

INTRODUCTION

1.1General Background of the Study

The banking industry has been characterized by increasing competition since the early 1980s
(Blankson, 2007). This has been the result of a number of interrelated factors such as
competition and deregulation that have revolutionized the distribution of many money
financial services. In other words, an increased competition resulting from a decade of
deregulation of financial services industry has meant that banks find themselves faced with
the task of differentiating their organization and their offering as a means of attracting
customers (Blankson, 2007).

The concern of how customer preference among banks has been given considerable attention
by researchers (Almossawi, 2001,; Awang, 1997,; Blankson, 2007,; Boyd, 1994,; Mokhlis,
2009;,and Mylonakis, 2007). Exploring such information will assist banks to recognize the
appropriate marketing strategies needed to attract new customers and retain existing ones
(kKaynak & kKucukermiroglu, 2006). With growing competitiveness in the banking industry
(Grady & Spencer, 2000) and similarity of services offered by banks (Holstius&keynake,
2003) it has become increasingly important that banks identify the factors that determine the
basis up on which customers preference prefer between providers of banking services.

Modern banking in Ethiopia was introduced in 1905.at the time an agreement was reached in
between Emperor Minelik and representative of the British owned national bank of Egypt to
open a bank. The agreement led to the establishment of bank of Abyssinia which was
launched in February, 2001 by the emperor (Abraha, 2005), t This event marked the
introduction of banking in the country. The bank of Abyssinia was given a 50 year pleasure
and was engaged in issuing note; collecting deposits and granting loans, but its clients were
mostly foreign business men and wealthy Ethiopians (Mauri, 2003).

1|Page
 Ethiopian banking is flourishing financial results for the 2010 E.C fiscal year proven an
industry enjoying high growth, high profits, and high dividends. Even in the middle of
challenging situation, all key areas of banking operations: collecting deposits, providing loans
and foreign exchange dealing, showed growth of more than 20 percentpresent. Even though
Despite sharing strong expansion, there are of course prominent variations along with banks
in terms of their aggregate size, revenue source, customer focus, loan concentration, and
operational efficiency.

Presently there are 19 banks in Ethiopia of which 16 are private banks and the rest are
government owned banks. Moreover, looking ahead, banks will surely be y confront by the
entry some new banks, Abay, Awash, and other financial institutions. With growing
competitiveness in the banking industry (Grady &Spencer, 2001) and similarity of services
offered by the banks (Holstius&Kaynak, (2001, it has become increasingly important that
banks identify the factors that determine the basis up on which customer preference between
providers of financial services .In this regard, the researchers are is motivated to understand
the customer preference among the selected banks in Assosa town.

1.2 Statement of the Problem

The B banking sector plays an important role in the economic development of a country
through mobilization of funds from outside the country and channelling such funds to various
sectors of the economy. Banks are financial institutions that promote and help the activities of
customers by rendering different services. In order to get the quality services and benefits
from banks users select based on the services and fees which the banks render to the
customers. Therefore customers select the best bank to obtain the quality services by
considering some factors. These factors may be; proximity, good customer services, personal
relationship, interest rate, diversified number of branches and other aspects. (Cotler, 2007).

The following scholar’s studies, Maiyaki (2008) who examined the determinants of bank
selection criteria in Malaysia considering under graduate students while Mokhil (2009)
attempted to analyse gender based choice decision. Correspondingly, in Bahrain (Almossawi,

2|Page
2009) studied a case of college students and in Greek (Lonkis, 2007) studied the task of
customer preference in the home loan market. Other studies are also undertaken in Europe
(Bosnia & Herzegovina, 2009), Greek (Loamkis, 2009) and Africa; ,(Ghana (Blanks,2007)
and ; Nigeria (Maiyaki, 2010; 2011) on the issue of bank selection criteria and in line with
customer preference as to why and how they prefer a particular bank to be serve them.
Although such studies have contributed substantially to the literature on the selection, their
findings may not be applicable to other countries like Ethiopia, due to differences in cultural,
economic and legal and environmental conditions.

To the best of the researchers’, knowledge there do not exist previous research conducted in
Assosa concerning the banking selection of customer preference. Therefore, this study is
particularly intending to examine the assessment of factors that affect customer preference
among banks in Assosa town. The study is expected to fill the gap in the literature by
scrutinizing the determinants of customer bank selection in Assosa town

1.3 Research Questions

 What are the factors that affect the customer’s preference among banks?
 What are the most important factors?
 What are the different services that the customers obtain from the banks?
 Do the customers have enough information about the services given by the
banks?

1.4 Objective of the sStudy

The study was addressing tried to address the following basic objectives.

1.4.1 General Objectives

The general objective of this study was to investigate ion the factors that affect customers
preference among banks in Assosa town.

1.4.2 Specific Objectives

The specific objectives of the study was:.

3|Page
  To identify the factors that affect the customers preference among banks;
 To examine the most important factors used by customers in choosing their bank;
 To assess the different services that customers obtain from the banks;
 To examine whether the customers have enough information about the services
given by the banks.

1.5 Significance of the Study

This study was gives a basic understanding and information to the banks studied on how to
attract customers and improve their service delivery system. It also initiates the concerned
bodies to give more emphases in the field. Moreover, it adds some necessary information
about factors that affect customer’s preference among banks and finally it became can be
used as reference for those researchers who study related fields.

1.6 Limitations of the Study

During the study, the researchers faced with the following limitations: lack of sufficient data
in the bank, unwillingness of the respondents to give the necessary information, lack of time
on respondent side and lack of adequate printed documents.

1.7 Scope of the Study

The study was conducted in western part of Ethiopia, in Assosa town. Undertaking a study
about the factors that affect customer preference among banks at the country level is very
important. However, due to time, financial and other constraints, the study is geographically
delimited to five selected banks in Assosa town.

1.8 Organization of the sStudy

The paper is organized in to five chapters. The first chapter deals with introduction of the
paper including background of the study, scope of the study limitations of the study and
organization of the study. Chapter two deals with literature reviews, chapter three deals with

4|Page
methodology of the study, chapter four deal with data presentation, analysis and
interpretation and chapter five deals with conclusion and recommendations.

CHAPTER TWO

LITERATURE REVIEW

2.1 Concepts and Definitions of a Bank

Chambers twenty country century dictionary defines a bank as an institution for the keeping,
lending and exchanging of money. A similar definition has been given by Kent who defines a
bank as an organization whose principal operations are concerned with the temporary
accumulation of temporally money of the general public for the purpose of advancing to
others for expenditures. Thus ordinary banking business consists of changing cash for bank
and bank deposits for cash, transferring bank deposits from one person or cooperation to
another, giving bank deposits in exchange for bill of exchange, government bonds, the
secured and un secured primaries of business men to repay, thus Thus a bank do is an
institution which accepts deposits from the public and intern advances loan by creating
channel of fund. Banks are financial institutions that accept deposits and make loans.
Included under the term banks are firms such as commercial banks, savings, and loan
associations, mutual savings banks and credit unions. Banks are finical intermediaries that the
average person interacts with most frequently.

Bank is a business establishment that safeguards people’s money and uses to make loans and
investments. Banking is as old as vivid organization. The ancient Roman developed and

5|Page
advanced their banking system to serve their vast trade network, which extended throughout
Europe, Asia and much of Africa.

Bank is a commercial institution concerned mainly with making and receiving payments on
the behalf of its customers, accepting deposits and making short term loans to private
individuals, companies and other organizations. In the United Kingdom, the banking system
comprises the bank of England (the central bank) the commercial banks, merchant’s banks,
branches of foreign and common wealth banks. Banking is defined as the acceptance of
deposits of money from the public for the purpose of lending or investment; such deposits
may be repayable in demand or otherwise and withdraw Able withdrawable by draft, order
or otherwise.

Thus a bank must perform two essential functions

 Acceptance of deposits
 Lending or investment of such deposits.

The purpose of deposit and loan products normally distinguishes banks from other types of
financial firms. Deposit products pay out money on demand or after some notice. Deposits
are liabilities for bank, which must be managed if the bank is to maximize the economics
money, banking and financial markets Mishkin, 1992, p.34)

2.2 Emergence and Development of Banking Institutions

It may be said that banking in its most simple form is as old as authentic history. As early as
3000 BC c. Bobby content had developed a system of banks. In ancient Greece and Rome,
the practice of granting credit was widely prevalent. Traces of credit by compensation and
Egypt before the system attained full development in Greece and Rome. The book of the old
Sanskrit are full of re regulations governing credit, he speaks of judicial proceedings in to
bankers, users and even of the renewal of commercial papers.

6|Page
In romeRome T the banks were called Argentorioe. Some of the banks carried business on
their own account and others were appointed by the government to receive the taxes. They
used to transact their business of similar lines as those of modern banks. People seed to settle
or draft on the bank. If the creditor had also on account of the same bank, the account was
settled by an order to make the transfer of such money from one name to another. To pay
money by a draft was known as prescribe and the draft was known as attribute.

As early as 1349, the business banking was carried on by the drapers of Barcelona d. There
Daring 1401, a public bank was established in Barcelona wna. The bank of Amsterdam was
established in 1607 to meet the needs of merchants of the city e it It accepted all kinds of
specie on deposits. These deposits could be withdrawn on demand or transferred from the
account of one person to another.

These written orders, in course of time, come to be used in the same manner as modern
cheques. It is interesting to note that most of the European banks existence formed on the
model of the Bank of Amsterdam.

The beginning of English banking may correctly be attributed to the London gold sixtieths.
They used to receive their customers valuables and funds for sattecase today and issues
receipts acknowledging the same .In fact, the Gold smiths not may be considered as the
precursor of the bank not. The Gold smiths not may be considered as the precursor of the
bank not. The business the gold smiths, who then carried upon attiring scale what we should
now call banking used to depots third reserve of treasure in the exchanges. The gold smiths,
who then carried upon attiring scale what we should now call banking used to deposit third
reserve of treasure in the exchanges with the sanction and under the large of the government.
(Abrha,2005,&Mishikin,1992)

However, the rain of gold smiths marks turning point in the growth of private banking and
the establishment of the “Banking of England in 1694”In India, as early as the Vedic period,

7|Page
banking in the most creed form existed. The bank of menu contains reference regarding
deposit dredges, policy of loans and rates of interest. True, banking in these days largely
meant money lending and the complicated mechanism of modern banking was not known to
them. This is true not only in the case of India but also of other countries. Although the
business of banking as old as thematic history, banking institutions have since then changed
in character and content very much. They have developed from a few single operations
involving satisfaction of a few individual wants to the community by securing speedy
application of capital the very life blood of commerce. The early sixties show the birth of a
dynamic private bank, which arise the latest competitive spirit in the banking system. It was
called Addis Ababa bank was established and had contributed a lot during its ten years
existence until 1974 towards the creation of competitive banking sector- The Italian banks
choose to stay where they were and the co-option comes to force in 1960s and early 1970s.
(Holstius,Keynake& Maur,2003)

2.3 Types of Banks

Banks are of various types which are explained as under:

2.3.1 Commercial Banks: Commercial banks are those banks which perform all kind of
banking functions such as accepting deposits advancing loans, credit creation and agency
functions. They are also allied joint stock banks because they are organized in the same
manner as joint stock companies. They usually advance short term loans to customers. Of
late, they have started giving medium term and long term loans. (Keynake(2003)

2.3.1.1 Exchange Banks:-Exchange banks are those banks which deal in foreign exchange
and sterilize in foreign trade. They are called foreign exchange banks. In India, these banks
have their head office located outside India, the chartered bank and the tined lays bank have
their head in England, where as the American express Bank, and city bank have third head
offices in the USA –these banks also render other services such as collecting and supplying
information about the foreign customers, providing remittance facilities.(Maur(2003)

2.3.1.2 Industrial Banks: Industrial banks are those banks which provide medium term and
long term finance to industries for the purchase of land, machinery etc,They also underwrite
the debentures and shares of industries and subscribe to them. In India, there are a number of
financial institutions which perform the function of industrial banks. Such as Industrial
development bank of India, Industrial finance of India, Industrial credit Investment

8|Page
Corporation of India etc. These Institutions are also known a development Bank.(Maur,
(2003)

2.3.2 Agricultural bank: are those banks which provide credit to farmers for short term,
medium term and agricultural cooperative banks provide short terms loans to farms on the
mortgage of their land. The National bank of Agricultural and rural development provides
refinance facility to finances to any types of banks which give loans to agriculturalists.(Maur
(2003)

2.3.3 Cooperative Banks:

areAre those financial institutions which are organized on the principle of cooperation. In
rural area, there are agricultural cooperative banks which accept deposits and give loans to
agriculturalist, rural artisans, in areas. There are also cooperative banks which perform the
functions of ordinary commercial banks but give loans to their members only. (Maur, (2003)

2.3.4 sSaving Banks;

Saving banks help promote small savings and mobilize them; they have been very successful
in Japan and Germany. In India, post offices act as saving B banks. (Maur, (2003)

2.3.5 Central Bank:- The central Bank is the bank in a country which controls its monitory
and banking structure. It is owned by the government of the country and operates in national
interest. it regulates and issues currency, performs banking and operates in national interest,
and agency service for the state, keeps cash reserves of commercial and banks, keeps and
manages r international currency, act as the lender of the last resort, act as charring house
and controls credit. Maur(2003)

2.4 Function of cCommercial Banks

Commercial banks perform a variety of factions. These functions are discussed as;

2.4.1 Accepting Deposits: This is the one of the oldest functions of a bank and the banker
used to change a commission for keeping the money in this custody when banking
was developing as institutions. Now days Nowadays a banks accept three kinds of
deposits from its customers. The first one is s the saving on which the bank plays pays
small interest to the depositors who are usually small services. The depositors are

9|Page
 allowed to withdraw their money by cheques up to a limited amount during a week or
year. Business men keep their deposits in credit in current deposits by cheques
without notices. Deposits are also accepted by a bank in fixed deposits. The rate of
interest with length of the time period of the fixed deposits. But there is all
waysalways the maximum limit of the interest rate which can be paid. For instance,
the interest rate on fixed deposit over five years is 11% in India. (Holistius, 2003)

2.4.2 Advancing loans: one of the primary functions of a commercial bank is to advance
loan to its customers. A bank lends leans a certain percentage of the cash lying in
deposits on a higher interest’s rate than its pays on such deposits. This is how it earns
profits and carries on its business. T According to Holistius (2003) he a bank
advances loans in the following ways: Holistius(2003)

2.4.2.1 Cash credit: the bank advances loans to business against certain specialized
securities. The amount of the loans credited to the current account of the borrower. In case of
new customer a loan account for the sum is opened. The borrower can withdraw money
through cheques according to his requirement but pays interest on the full amount. (Holistius,
(2003)

2.4.2.2 Call loans: these are very short term loans advanced to the bill brokers for not more
than fifteen days. They are advanced against first class bill or such loan can be recanted at a
very short notice. In normal times they can also be renewed.

2.4.2.3 Over draft: A bank often permits a business man to draw cheques for a sum
greater than the balance lying in his current account. This is done by providing the
overdraft facility up to a specific amount to the business man.

2.4.2.4 Discounting bills of exchange; if a creditor holding a bill of exchange wants money
immediately, the bank provides him the money by discounting the bill of exchange. It
deposits the amount of the bill in the current account of the bill holder after deducting its rate
of interest for the period of the loan which is not more than two days .Holistus(2003)

10 | P a g e
2.4.3. Credit creation: credit creation is the most important functions of the commercial
banks. Like other finical institutions, they aim at earning profits. For this purpose, they accept
deposits and advance loans by keeping as well as cash but allows him to draw the money by
chute cheque according to his needs by racing loans, the bank creates credit or deposit.

2.4.4. Financing foreign trade: a commercial bank finance foreign trade of these customers
by accepting foreign bill of exchange and collecting term from foreign banks. It also transacts
other foreign exchange business and buys and sells foreign currency.

2.4.5. Agency service: A bank acts as an agent of its customers in collecting and paying
cheques, bill of exchange, drafts and it also buys and sells shares securities, defends for its
customers. Further, it pays subscription, insurance premier, rent, electric and water bills and
one her other similar changes on behalf of its clients. It also acts as a rusted and executor of
the property and will of its customers, moreover, the bank acts as an income tax consultant to
its clients. For some of this service, the banks charge other fee of charges.(Cotler,(2007)

2.4.6. Miscellaneous sServices: - Besides the above noted services, the commercial bank
performs a number of other services. It acts as a custodian of the valuable of its customers by
providing those lockers where they can keep their jewelleries and valuable documents. It
issues various forms of credit instruments, such as cheques, drafts, travellers’ cheques which
facilitate to its client.(Cotler,(2007)

2.5THEORETICAL RIVIEW LITERATURE

Decision hierarchy model for the selection of banks developed by Ta&Har (19) was adopted.
The decision hierarchy for the selection of bank is based on various criteria for deciding on a
bank. Our goal is to find out whether these criteria are the same used by customers.

2.5.1 Bank selection criteria

2.5.1.1 Bank Services

Most of the customers think that the services provided by the bank should be tailored towards
the needs. Their requirements for a banks’ service is very basic. This may be due to the fact
that; the customers are not working and do not have huge sums of money to save or

11 | P a g e
otherwise. Some of the responses include the following: but basically, some customers only
need ATM and debit cards. But if I were a businessman, I will consider all kinds of services
such as internet banking etc. The most important aspect of it especially the interest on my
money”; “yeah the services are very important, the banking institution is to offer services
they will influence, it will play a part, if a bank does not offer services tailored to suit I might
not choose the bank”; “…that one will influence me, I wanted to quit but because of their
convenience I stayed”; “Yes customers will affect me I will look out
.B.Narteh&N.Owusu(2011)

2.5.1..2 Third Party Influences

With regards to whether or not customer’ bank selection would be influenced by a third-
party, some of the customers say they will consider it, but a large number

Would not consider it.B.Narteh(2011)

2.5.1.3Electronic Services
This criterion according to some of the customers will be useful to them in the future and
some even do not understand it. This shows that the some customers require only basic
services satisfactorily. Some responses include the following: “Well, I am not really familiar
with it; I don’t think it will influence me”; “Yes it will influence me, due to locations, I am
able to use the internet services. N.Owusu,(2011)

2.5.1.4 Financial Benefit (Interest rates)

Financial considerations seem to motivate some of the customer in choosing the bank they
would like to patronize: “Most important aspect of it especially the interest on my money”;
“With reference to unique bank services there is 15% interest on it thus I opened my account
with them”; “Yes it counts, I should know my money will benefit me too and not only they
using it”; “I know the banks use my money for some business, so if they get something they
should give me something too.B.Narteh(2011)

2.5.1.5 Personal relation

One of the decisive factors in the bank selection process by the customer on a rank of five,
bank the employee customer relation come second and is considered very important by the
customers that, so it wouldn’t influence others desire. B.Narteh.&N.Owusu(2011)

12 | P a g e
2.5.1.6 Marketing Communication:
The respondents acknowledge that the communications that a bank put out could have
influence, but state however that these communications would not per se influence them. We
are of the view that, it’s probably because they are enlightened and can determine the
differences between perceived quality and actual quality of the service delivered. B.Narteh,
(2011)

2.5.1.7 Convenience:
From the interview we conducted, convenience is considered by almost all customer to be
very influential in their choice of selecting bank.B.Narteh&N.Owusu(,2011)

2.6 EMERICAL LITRATURE REVIEW

According to Almossawi (2010) there are many factors that can affect the customer
preference of banks and one of the factors is secure feeling. Mokihils (2009) points out that
secure feeling reflects the desire of banking with a stable bank and assurance of
confidentiality when making financial transaction. This implies that secure feeling includes
both the security at the bank and the security of the bank. Gerard and Cunningham (2008)
conducted a study in Singapore that addresses the issue of how customers preference the bank
to patronise. The survey concludes that for customer to become loyal, banks should
emphasize that they can make the customer feel secure. The key focus of any marketing
campaign should be on making customer feel secure more particularly emphasizing the banks
stability. Banks should also try to build good brand image, as many customer prefer to have
accounts in prominent banks where security arrangement are good so that can be assured of
the safety of their money ( Sharma &Reo,2011),

Renman and Ahmed (2010) reveal that convenience is one of the most important variables
influencing customer choice among other factors namely customer service, online banking
facility and overall bank environment. Customers devote much emphasis on electronic
service,(ATM) which gives them quick and convenient access to the bank service
(Mokiklis,2010). The study conducted by Sherman and Reo (2011) on bank selection criteria
concludes that convenience is an important determinant. Factors such as parking facility, free
delivery of demand, phone banking, and free home cash delivery suggest that customer want
convenience in banking and they want to save time.

13 | P a g e
Almossawi (2010) point out that proximity and service quality are important factors that
affect customer preference of banks. This suggests that banks customer will prefer bank of
ATM facilities that are close to the customer. Almossawi (2009) add that even though there
are scheme which enable ATM card holders to use ATM of any bank, they still need to visit
the bank when necessary to perform some service which cannot be done through ATM.
According to Mokhilis (2010) service provision come second interms interims of relative
importance considered by female customers when selecting their banks. The importance of
service provision is further evidenced by the study conducted by Gerard and Cunningham
(2009) on how customers preference on among banks.

Cicic, Brkic and Agic (2004) point out cost is another important determinant of bank
selection especially for university students. University students are non-income earners, and,
their primary objective is to minimize costs that are associated with financial transaction.
This means that students will prefer service charge as the most drive factor. According to
Cicic (2009) the most important bank preference determinant for the Bosnia and
Herzegovinian students falls within financial benefits including, first of all service charge
taking in to account the low level of living standard and low average income in Bosnia and
Herzegovina. On the contrary Cicic (2009) point out the factor like close proximity to home
and work, and price of the product are perceived to be the least important criteria on the
preference of banks.

According to Almossawi (2009) and Lenka, Sura and Mohopatra (2011) another important
determinant of bank preference is technology. Managers should realize that young people
enjoy dealing with advanced technical device such as ATM. This indicates that, in their bank
selection, the new generation of customers tend to put more emphasis on the factors which
give them quick and convenient access to the bank service, rather than factors related to
hospitality, condition of the bank premises, and location of the bank. Almossawi (2007) notes
that the vast majority of young people prefer to use the bank, note only for the speed and
convenience, but also for the mental structure of today young people who have been very
much involved with computer based activities.

14 | P a g e
According to Karate pea, Yvas and Babakus (2008) and Rao and Sharman (2010) total
customer preference is in accurately achieved when the management search and identify
exactly what customers want. To attract customers banks had to set up some kind of ATM,
phone banking, internet banking, and computation. In turn, banks have to understand the
customer needs so as to take care of its customer satisfaction. Gerard and Cunningham (2009)
and Kaynak and Harcas (2008) contend that electronic service are of relatively higher
importance. Even thought they were not available for that long, the current well educated
generation has been exposed to modern technology in their higher education which will
increase their drive to patronise banks that are regarded as technology leader.

Cicic (2009) and Maddern, Maull and Smart (2007) point out that and lack of courtesy of
banks personnel are major reason customers exit banks. The study reveals that customers
highly regard knowledgeable and competent personnel coupled with good relation and values
to the most important criteria in bank preference.

Almossawi (2009) and Haqque Osman and Ishmael (2010) add the customer prefer to deal
with popular and reputable banks. This implies that banks can attract customer by engaging
in various public relations and marketing activities that would give them total recognition by
the customers. According to Mokhils (2009), people influence and recommendation is also
among the important factors in bank customer preference for both male and female
customers. Almossawi (2009) find that recommendation for a good relation and
recommendation of relatives are of relevance despite the factor customer preference to act
independently. In contrast, Gerard and Cunningham (200?) find that the third party influences
are of little importance in customer preference of bank.

Based on this research customer preference can be influenced by rivalries among banks to
catch up the customers by using promotion in the society such like on edir, ekub and like the
community session to comprise the major part of the customers those repeated to the banks

15 | P a g e
service. In Ethiopia, the customers do not have awareness on choice of banks and this has
many hazardous impacts over the customer preference among the banks. For example;
commercial bank of Ethiopia has a big perception on the customers if it is compared with the
other banks. In Assosa also the mentioned indication was known specially popularity of the
commercial bank of Ethiopia can influence the customers to select this bank as their first
choice.

CHAPTER THREE

METHODOLOGY FOR THE STUDY

3.1 Research design

The type of research that researchers were used in this study is descriptive type of research.
Because, the researchers have no control over the variables, can only report what is
happening. The main purpose of the descriptive research is description of the state nature or
affairs, as it exist at present, so the aim of this study has been to describe the actual
assessment of Ffactors that affects customer preference among bank in case of Assosa town.

3.2 Target population

The Target population of the study was the customers of 5 banks which are operated operate
in Assosa tow town .i.e. Abyssinia bank, aAwash international bank, Dashen bank,
Commercial bank of Ethiopia and w Wegagen bank. In Assosa town, other banks are also
found but since some of them are recently opened branches and others are sub-branches of
the above banks, so they are not included in the target sample. Thus, the target population is
the customers of the above mentioned five banks. Total customer 61400 the total customers
from each bank can be shown as follows.

Table 3.1 The No of customers from each bank and the proposed sample

Name of Banks No of No of Sample

16 | P a g e
 customers

Abyssinia bank 3500 6

Awash bank 12500 20

Commercial bank of Ethiopia 36450 59

Dashen bank 4590 8

Wegagen bank 4360 7

Total 61400 100

Source: from survey data, 2017

3.3 Source of data

Both primary and secondary data sources were was used. The primary source of data was
collected from individual business men, and other customers of the banks. And the secondary
data are documents, internet and other researches.

3.4 Data collection Instrument

The data had been collected from customers using questionnaire method of data collection
both unstructured and structured questionnaires had been used. Regarding those customers
who cannot read and write an interview was used as an appropriate method. And the
secondary data had been collected from different published materials and documents of the
banks.

3.5 Sampling Technique

Because the population under the study area is heterogeneous, stratified sampling technique
was used. For this reason stratified sampling method make homogenous by dividing in it to
different strata in order to present the true population.

3.6 Sample size

Use of sample can save time and money (Economical) and helps to obtain detail information
and structure of population. The researchers will take took sample size of 100 customers by
using the following formula: of proportional

To determine

17 | P a g e
n=N/1+N (e ^2) (source from business statistics 2nd edition)

n=where n-sample

N=Total population

e= Error

N=N1+N2+N3+N4+N5

N1-Abysinya=3500 n= 61400/1+61400(0.01^2) =99.83≈ 100

N2_Awash = 12500 N3-C.B.E=36450

N4-Dashen=4590 N5-Wogagen =4360

After determine the total sample size is determined, it is distribut was distributed e in to the
five selected banks. In order to know the sample size of each bank the researchers we can
used the proportional and sampling technique.

Number of one bank customer@100%/total number of five selected banks

•N1=3500*100%/61400=6

•N2=12500*100%/61400=20

•N3=36450*100%/61400=59

•N4=4590*100%/61400=8

•N5=4360*100%/61400=7

n1=6 n4=8

n2=20 n5=7

n3=59

Total sample = 100 customers

3.7. Data processing and Analysis

After all the necessary data collected, data processing and data analysis was carried out. To
make the raw data suitable for analysis and classification, data processing were made.
Finally, the raw data has been organized in to groups on the basis of common characteristics.
Descriptive method of data analysis was used because we collect the collected data that is

18 | P a g e
more of quantitative. In order to interpret the data the researchers has used tables and
percentage.

CHAPTER FOUR

4. DATA ANALYSIS, INTERPRETATION AND PRESENTATION

The study was conducted on the customer preference of banks in Assosa town. In this study
100 customers were taken as a sample. From these sample customers only 70 of them have
returned questionnaires.

4.1 Demographic characteristics of sample respondents

Table4. 1Demographic characteristic

1. Age interval Items No of responds Percentage

18-35 38 54.3%

36-49 22 31.4%

Above 50 10 14.3%

Total 70 100%

2.sex Male 48 68.6%

Female 22 31.4%

Total 70 100%

3. Educational Status Illiterate 10 14.4%

Grade 1-8 8 11.2%

Grade 9-12 12 17.1%

Diploma 18 25.8%

19 | P a g e
 Degree and above 22 31.5%

Total 70 100%

4. Religion Orthodox 33 47.1%

Muslim 12 17.1%

Protestant 20 28.6%

Catholic 5 7.1%

Total 70 100%

5.Job Business man 32 45.7%

Employee 27 38.6%

Other 11 15.7%

Total 70 100%

Source: Compiled from questionnaire June, 2018

As summarized in the above table, most of the sample customers are between the ages
intervals of 18-35, which constitutes 54.3% of the total sample customers. In addition out of
the total sample customers, 31.4% of the samples are between the ages intervals of 36-49.
And the age group of above 50 has the least share from the total sample customers, which
constitutes 14.3%.

As per the above table, most of the sample customers are male, which is 68.6% and the
remaining 31.4% of the total sample are female.

As the above table states that most of the total sample customers are degree and above which
constitutes 31.5% and 25.5% of the total sample customer are between grade diplomas
followed by grade 9-12 having the share of 14.4%, and 7.5% of the total sample customers
are illiterate and the remaining 11.2% of the sample are between grades 1-8.

As indicated in the above table, 47.1% of the sample customers are orthodox which uses bank
and they are customers of the bank. In addition17.1% of the sample customer are Muslim
which is less as compared to orthodox because paying interest have no acceptance in their

20 | P a g e
religion and accepting deposit deepest without interest is not developed in the bank. In
addition, protestant 28.6% and other catholic 7.1% constitutes the least of all.

As the above tables show that, most of the sample customers are business man men which is
45.7% of followed by employees which shares 38.6% of the sample and the remaining 15.7%
of the sample customers are students and other self-workemployees.

4.2 Knowledge of customers for the service that are given by the bank

Table 4.2 knowledge of customers

Knowledge of customers Numbers of respondents p Percentage

Customer that have 51 73%
knowledge about service
given by the bank
Customer have not 19 27%
knowledge for the service
given by the ban k
total 70 100%

While preferring bank, the customers’ knowledge for the service given by the bank is the
main factors. As the main focus of this study is concerning on the preference of banks. All
the respondents are users of bank.

Based on the data that was collected by the questionary show questionnaire that, 73 %( 51)
of the total sample customers have knowledge about the services given by the banks and they
know why and for what purpose they used the bank. Whereas the remaining 27 %( 19) of the
sample customers haven’t do not have knowledge about for the services given by the banks.

4.3 Types of services given by the bank to the customers

Table 4.3 Types of services given by the banks

21 | P a g e
Type of service given by Numbers of respondent pPercentage
bank to customers
Checking account 27 38.6%
Saving account 21 30%
Transfer service 12 14.1%
Loan and advance 10 12.85%
TTotal 70 100%

Source: compliedCompiled from questionnaire questionary 2018

Note that the customers uses one or more bank services, for this reason, the total number of
respondent exceeds the total sample of the customer in the questionnaire

Most of the sample customers are users of checking account service which constitutes (27)
of 38.6% and followed by saving account which share (21) of 30% of the total customers.
Whereas (12) of 14.1% of the total sample customers constitutes by local transfer services.
The remaining (10) of 12.85% are constitutes by loan and advance services.

4.4 Customer preference of bank for the services given

Table4. 4 pPreference of bank for saving account

Service type Bank No of respondent Percentage

Saving account Abyssinia bank 4 16.7%

Awash bank 5 20.83%

Commercial bank of Ethiopia 6 25%

Dashen bank 7 29.17%

wegagen bank 2 8.3%

Total 24 100%

Source: compiled from questionnaire 2018

22 | P a g e
If the customers need a simple way to start saving for a short term needs like a day fund this
is a great account. They will earn a competitive rate and still have easy access to their money
when they need. The above table reveals the preference of bank for saving account by the
customers. % 29.17% of them have responded that are users of d Dashen bank.
WhereWhereas the commercial bank of Ethiopia has secondly stood second with prefer of
the customer by 25% . and 20.83% and 16.7 % of .the total customers of the sample
customers respondents are users of saving account in Awash and Abyssinia banks
respectively. Finally, 16.7 bank. the the remaining 8.3% of the sample customers are users of
wWegagen bank.

4.5 Preferences of banks for checking account

Service type Bank No of respondent Percentage

Checking Abbysinia bank 2 7.4%

account
Awash bank 8 29.7%

Commercial bank of Ethiopia 12 44.4%

Dashen bank 3 11.1%

Wegagen bank 2 7.4%

Total 27 100%

Source: compiled from questionnaire2018

Checking account uses for safe method of transferring payment and to reduce risk of losing
money and theft. This type of service is mainly designed to fulfill the methods of those
customers who are not willing to collect interest.

As indicated by the above table c Commercial bank of Ethiopia is the most selected by
the customers in case of checking account, F followed by a Awash international bank which
share 44.4% and 29.7% from the total sample customers respectively. In addition d Dashen
bank shares 11.1% of the total sample customers. Whereas 7.4 % of the total sample
customers are users of checking account in Abyssinia bank and wegagen bank the remaining
7.4% of the total sample customers are users of checking account in the same two banks
Wegagen bank.

23 | P a g e
Table 4 .6 p Preference of bank for loan and advance services

Service type Bank No of respondent Percentage

Loan service Abbysinia bank 1 14.3%

Awash bank 1 14.3%

Commercial bank of Ethiopia 2 28.6%

Dashen bank 2 28.6%

Wegagen bank 1 14.3%

Total 7 100%

Source: compiled from questionnaire2018

Loan can be granted in three forms, based on maturity period.

i.e. s Short term:- is a loan lone that has a maturity period of less than one year

Medium term:- is a loan lone that has a maturity period exceeding one year but less than or
equal to five years from the date loan contract is signed.

Long term loan: is a loan lone which has a maturity period of above five years.(modern
money & Banking Ripper Leroy miller & David D.vanHoose, 3rd Edition)

The above table shows that 28.6% of the total sample customers are users of the loan and
advance in cCommercial bank of Ethiopia and Dashen bank. These indicates that commercial
bank of Ethiopia and Dashen bank are is the most banks preferable for the loan service,
followed by the same Abbysinia, Awash international bank and w Wegagen banks
respectively. The remaining bank which each 3 banks shares 14.3% of the total sample
customers, are uses loan service.

Table: 4.7 pPreference of bank for transfer service

24 | P a g e
Service type Bank No of respondent Percentage

Transfer Service Abyssinia bank 2 15.4%

Awash bank 2 15.4%

Commercial bank of Ethiopia 5 38.5%

Dashen bank 3 23%

wWegagen bank 1 7.7%

Total 13 100%

Source: - compiled from questionnaire 2018

Transfer is the process of sending money from one place to other place and it reduces the risk
of losing money. There are different types of local transfer services. These are telegraphic
transfer, mail transfer. Demand draft and cashier payment order (Denton., 1989)

As indicated in the above table the customers of Commercial bank of Ethiopia constitutes
38.5% of the total sample customers for transfer service. Which is also the followed the d
Dashen bank of by sharing 23% of the total sample customers. In addition from the total.S
sample customers Abbysinia bank and Awash international bank each constitutes 15.4%. And
the reaming 7.7% of the total sample customers are users of transfer service in w Wegagen
bank.

4.5 Factors Affecting Bank preference

Table 4.8 Factors of bank preferences.

Factors No of Percentage
respondents

m My employer uses the same 3 5.5%

banks

Proximity (the bank is very close to 9 16.67%

my places)

Banking technology or speed of 4 7.4%

activity

25 | P a g e
If customer deposit their money the 3 5.5%
bank gives incentives

The bank has a good security 1 1.85%

The employee deliver the service 7 12.96%

efficiently

The bank has ATM services 2 3.7%

The bank has a mobile banking 4 7.4%

The loan rate is lower than the other 3 5.5%

banks

The loan obtaining procces is very 2 3.7%

short

Service charge lower than other 5 9.25%

banks

The bank advertise its services via 2 3.7%

mass media

The banks branches are connected 3 5.5%

to the core banking system

Recommendation from my family 2 3.7%

or my friend

Minimum waiting time 4 7.4%

Total 54 100%

Source compiled from questionnaire 2018

Note that one person might be giving more than one reasons of factors that bank preference.
As stated in the objective part, the general objective of this study is to identify those factors
that affect customer’s preference among the selected banks existing in Assosa town and those
which are listed in the above are the main factors. Let’s see. O one by one how they affect
customers.

26 | P a g e
Speed of activity (minimum waiting time)

-t This means satisfying customers with in short period of time. This factor is significant
mostly in the transfer service. In connection to this 4 of 7.4%of the sample would consider
speed of activity as a base for selecting the bank. There for speed of activity is the main
factor for bank preference in Assosa town customers.

The bank has good security

Security is one of the most important factors for selection of bank because respondents
deposit their money for future consumption, and so safety is an important factors for selection
of banks. Based on above table from total respondents replied questionaries’ (1) of the1.85%
considered security as an is important factors bank of bank selection criteria

The employee delivers the services efficiently

Providing better service for customer satisfaction is another factor to customers in selecting
the bank. If the products or services performance falls short of expectations, the borrower or
users become dissatisfied. (kotlerKotler Kotler (2003). c Customer satisfaction is also another
reason in selection of bank as customers of Assosa town said.From the total sample
customers 7 of 12.96%were choices the bank based on satisfaction get from the bank.

If the customers deposit their money the Bank gives an incentive

This is a practice which done by the banks to the customers. Interest rate to the customer is a
factor to select bank. From the sample customers (3) of5.5% would consider low interest rate
is a factor to selection of a bank..

Recommendation from my family or my friends

It is a decisive factors in the B bank selection process by the customer, rank of the f Family or
friend relationship is would influences the bank selection decision.

Based on above table from total respondents (2)of 3.7% ,the bank branch are connected to the
core banking system (3)of 5.5% ,the bank advertise it's services via mass media (2)of3.7% of
selected respondents that returned questionary, mobile banking (4)of 7.4%,the loan obtaining
process is very short(2) of 3.7%,my employer use the same bank(4)of 5.5%and loan rate is

27 | P a g e
lower than other banks (3)of5.5% are most important factors which affects customers bank
selection decision

4.6 s Suggestions of Respondents for improving the services given by the banks

The respondents mentioned different suggestions in order to improve bank services. The most

I important suggestions are:

Table 4.9 s Suggestion of respondents for improving the services given by banks

Suggestion of respondents Number of respondent Percentage %

for improving the service
given by the bank
Widen the number of branch 9 31.11%
Increase the span of services 11 37.95%
Provide modern kind of 4 13.8%
service
Create strong relation with 2 6.89%
customer
Giving education to 3 10.3%
customer how bank is useful
to them
Total 29 100%

Based on table 4.9 from customer's of assosa town respondents suggested (9) of or 31.11%
respondents suggested suggests to W widen the number of branches, (11) or of37.9% of them
suggested to increase the span of services, (4)of or 13.8% of the respondents suggested
expansion of modern customer services(provide modern kind of services (2)of or 6.89% of
them suggested creation of strong customer relation with customers and (3) or of10.3%
suggested giving education to customers how bank is a can be useful to them. customers are
suggestions given by respondents

Widen the number of branches’

Increase the span of services

Use modern service (provide modern kind of services)

Create strong relationship with customers

28 | P a g e
Giving education to customers how bank is useful to them

CHAPTER FIVE

5. SUMMARY OF FINDINGS, CONCLUSION

AND RECOMMENDATIONS

5.1 Summary of Findings

Before concluding and suggesting recommendation, it is better to summarize the main

findings of the study.

The Assosa town bank customers have moderate knowledge about bank, standing on the
responses given by the sample element. Even if the customers are moderately aware about
bank, its importance and being influenced by different economic and religious problems, the
society have positive attitude towards banking. Therefore, knowledge is a partial rather than
complete factors. Most of the customers of banks found in Assosa town do not properly use d
their accounts. This may have a damaging effect for identification of real customers of the
bank and providing loans and advance. Providing consultancies during the opening account
period on services utilization will help the customers for proper usage of the service given by
the bank. But only few sample customers are given consultancy on service utilization.

There are many factors inflecting for affecting the preference of a bank. In this studyThe
study in fulfillment identified that fulfillment of the following factors have its Owen
drawback their own contribution in preferring a bank:-

A. Good customer service: this providing better service to customers and trading well
while using the service.

29 | P a g e
 B. Speed of activity: this is the time taken to perform an activity. The best bank is the
one who takes smaller time to perform the activity.

C. Proximity (nearness):- means being nearer to the customer who use it. Therefore,
nearness has its own role in preferring bank

D. Personal relationship: is selecting a bank because of personal relationship or social

relationship rather than performance of the organization by the customers.

E. Low interest rate:- this is providing of loan for customers with in higher a lower rate
of interest.

F. Accessibility (convenien conveniencet) in all areas: - this is finding in all area you
want. Therefore, accessibility is a base for selecting a favorite of a bank.

5.2. Conclusions

After analyzing, discussing and summarizing all the data collected it is necessary to provide
conclusions based on the analysis made in chapter four,

Based on the findings achieved obtained the customers, has its own strength and weakness
on preferring of customers take various factors in to account bank exactly in deciding which
one bank is best to them. As the is findings approves suggest, all the sampled respondents of
the customers are used selected their favorite bank and some of the looking for services such
as; saving account, current account, loan services and transfer services. The customers used
selected their bank for the advantage of safety and security of their money, for facilitating
their business activity and for investment purposes.

Generally, the identified weakness and their consequents from the finding are:-

30 | P a g e
 - Even though the customers have moderate knowledge about the services rendered by
the banks, still now they are not aware about the services other than saving, current
account, loan and transfer service

- The customers have notdo not have more adequate information in relation to
undertake about the criteria for bank selection.

- Since the bank did not arrange and time to contact with their customers and are not
use different types of announcements ( advertisements), the customer have not enough
knowledge and understandings

- Though, the banks rendered different types of service to the users the customers need
another services to be added to on their organization.

5.3. Recommendation

Before recommending the findings, we have seen how data are collected, from where they are
collected, what are the result and how they are analyzed. But identifying the several facts and
actual practice and interpreting them is not enough and is not the last objective of the study.
So, d Depending on the above findings and conclusions, the researchers would like to
forwards the following recommendations to the weakness identified for concerned party
should be made.

These are:-

31 | P a g e
1. To enhance the knowledge and better understanding of the customers, the banks
should have some arrangements and contact with their users by creating making
smooth relationship with customers to let them know about the services of the banks.

2. The banks also should try tries expanding their services especially using ATM service
and interbank transfer service since it is better for customer and the banks.

3. The customers have known about the banking service in detail and they have exact
criteria in selection a bank depending on facts

4. The banks should announce about their services to the customer and the people should
try to know the additional service.

5. The customers should prefer the bank according to performance and the technology
the bank used.

REFERENCE

 Abrha, analysis of customer knowledge and choice creteria vol, 29, 2005.
 Almossaw,an empirical analysis international journal of Bank marketing ,vol ,19 ,
2001.
 Anderson, W.T,.Jr.,Cox,E.P and Fulcher,D. G.Bank selection, decision and
Market segmentation, journal of marketing, Edition vol.40, 2005.
 B.Grady&Spencer managing commercial banks practices, 2000
 B.Narteh&N.owusu,.Owusu_firmingo,an analysis of bank selection criteria in retail
bank selection in sub Saharan Africa,vol29,2011.

32 | P a g e
 Blankson ,Determinant of bank selection in USA,vol,25,2007
 Boyd,international journal of bank marketing, vol,25,1994
 Cotler,Determinants of bank selection decisions, 2007.
 DK.C shekhar and locksbimy ,banking theory and practice, 19th Edition1998,
 Frederic s.miskin, the economics, money and financial market 5th edition, vol.14,
2002.
 Gerrard's & JB.Cungham, under graduate student how they choice banks, vol19,
2009.
 Hostius&Kynake banking preference and market performance ,2003
 Khazer M, kee F. how customers prefer banks Indian institute of banking and
finance, principle of banking. 8th vol. 13, 2005.
 Laroche, M., Rosenblatt and T.Manning, service used and factors
considered important in selecting a Bank; international journal of bank
market 3thEdition vol.21, 2001.
 LioydB.Thomas, money, Banking and financial market 12thEdition
vol.2, 1997.
 M.L JHinpan, money, Banking,(1997) international trade and finance , 7th edition
 Maiyaki, A.A. (2002) determining banks selection and preference
volume 6, 2011
 Maur,journal of service science and management,vol6,2003
 Maylonak,attitude toward banking vol,12 ,2007
 Mokihils,retail banking analysis of customers No.16,2009
 Phillip cotiller, marketing management customer service 9thedition,
vol. 19, 2003.
 The oxford Dictionary for the business world, 1993
 The world book of encyclopaedia, volume 2, Edition 11th, 1998.

33 | P a g e
34 | P a g e
 APPENDEX

ASSOSA UNIVERSITY

College of Business and Economics

Department of Accounting and Finance

Questionnaire

The objective of this study is for the preparation of senior essay required for partial fulfilment
of B.A in Accounting and finance. The information supplied by you would play a great role
for the success of this study and will be kept in secret.

Am We are glad to extend my our thanks for eign your cooperation in advance.

- Use this “” mark for the answer you select

- No need of writing your name.

1. Age : A, 18-35 B. 36-49 C. Above 50

2. Sex : Male Female
3. Educational background

Illiterate Grade 1-8 9-12

Diploma degree above degree

4. Religion

Orthodox Catholic protestant

Muslim other, Specify

5. Types of job

35 | P a g e
 Business man Employee Other, Specify __________

6. Do you know bank?

Yes No

6.1 If yes what it is? _______________________________________

7. Do you use bank?

Yes No

7.1 If No, why? _______________________________________________

_________________________________________________________________

7.2.1 If yes, what are the services provided by the bank to your activities

Checking account saving account transfer service

Loan Other, Specify___________________________

8. Which bank do you prefer for the services mentioned above?

Please, Specify_____________________________

9. Why you prefer the bank you selected above?

Please use this “” mark for the answer you select depending on the following alternative

1. Very less important 2.less important 3. Important 4. Very important

1 2 3 4
1 The bank has a good security
2 The employees deliver the service efficiency
3 The bank is very close to my place
4 The bank has ATM service

36 | P a g e
5 Mobile banking
6 The loan rate is lower than the other banks
7 The loan obtaining process is very short
8 My employer uses the same bank
9 Service charge is lower than the other bank
10 The bank advertises its service in via mass media
11 The bank branches are to connected core banking system
12 Recommendations from my family or my friend
13 If the customer deposit their money, the bank gives an incentive
14 Minimum waiting time

10. Are the services rendered by bank in your area sufficient ly?

Yes No

10.1 If no what action must be taken in order to improve the quality and quantity of banking
Sservices?
___________________________________________________________________________
____________________________________________________

11. Do you have enough information about the service given by the bank

Yes No No

11.1 If No, why?_________________________________________________

____________________________________________________________________

12. Do you think that there are other factors which can affect your bank preference?

a. Yes

b. No

If “yes” for the above question, please mention

them.______________________________________________________________________
_____________________________

37 | P a g e
Thanks for your cooperation!

38 | P a g e