An analysis of customers’ loyalty to banks in Ghana

Yazeed Abdul Mumin, Paul Kwame Nkegbe, Naasegnibe Kuunibe


The increasing concern of banks about market share and customer equity in the light of unpredictable behaviour of customers has brought to the fore the pre-eminence of customer loyalty. This underscored the analysis of customers’ loyalty to banks in Ghana. This study fitted a binary probit model, utilizing cross-sectional data from 130 customers of banks in the Wa Municipality. The results of the regression showed that satisfaction, bank type, distance, ATM facility, time to transact, switch cost, loan commitment, other facilities and auxiliary banking are the significant determinants of customers’ loyalty to their main banks. Proximity to customers and infrastructure base of a bank are essential factors influencing customers’ loyalty. Banks should consider establishing branches and providing ATM services within and without the municipality, to get banking closer to customers, as a way of reducing customer defection.

Keywords: Customer loyalty, banks, probit, customer satisfaction, Ghana


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