BANK CHARGES AND CUSTOMER SATISFACTION IN THE NIGERIA BANKING SECTOR

​​​​​​Background of the study: Customers are presumed the stakeholders of an organization and for an organization to flourish, the needs of the customers must be met. Without the presence of customers, the goals and objectives of an organization will not be achieved. It is therefore pertinent to carry out a research on the behaviors of customer, because knowledge of this will help an organization know how to deal rightly with their customers. In the 80s, the banking sector of Nigeria did not have many policies as regards the way customers’ services should be met. During this era, the number of banks increased, there was availability of foreign reserves, the GDP increased and there was job creation. The banking sector contributed enormously to the economic growth of Nigeria (Adeoye, 2007). In 2005, 2006, 2007 and 2008 were 8.1, 9.2, 9.8 and 10.6 respectively (CBN, 2009). The truth still remains that the banking sector does not only contribute to the growth of Nigeria alone, but in a way contributes to the economic growth of surrounding African countries. The satisfaction of customers should be the primary aim of any organization. Retail banks use customer satisfaction as a tool to measure their quality and management of customer relationship with customers (Mihelis et al., 2001). In addition, customer satisfaction as a marketing tool helps an organization know its strengths and weaknesses while offering its products and services. Customers could prove dissatisfaction of either the products or services of a bank either through complaints or raining abuses on the bank. When customers complain of dissatisfaction, it can affect the customers’ loyalists and further make them to patronage other competitors. However, when customers are satisfied, it makes them happy, fulfilled and excited (Hoyer and MacInnis, 2001). It creates this impression that the value of their money is fully achieved and they will not think of switching banks. Also, it will make customers good referrals of their banks, subsequently bringing in new customers. There are four factors that assess the customer satisfaction in banks: optimum facilities of a branch, economic satisfaction (bank charges and interest rates), presence of e-banking and Automated Teller Machine (ATMs) (Chakrabarty 2006). Service and product quality are the measures banks need to put in place to serve their customers efficiently. Meanwhile, banks in Nigeria through their services, most especially when it has to do with charges make their customers dissatisfied. Recently, the Central Bank of Nigeria approved some laws with regards to charges on banks’ customers. Some of those charges include: a charge of N1.00 for every debit transaction done on a current account, the N50 stamp duty on non-oil revenue transactions, N100 e-DMMS Application fee for investors, the N65 ATM withdrawals from other banks and NSE/CSCS Trade Alert. Charges of these sorts have the tendency of affecting the customers and purposively, the bank. There are cases of bank customers storming the bank, most especially the customer service unit to find out why some certain amounts were deducted from an account. Cases like this can leave the customer angry, lost of customers’ trust, customers’ switching to other banks and the reputation of the bank being at risk. However, Nigerians complain a lot about the charges of banks on their customers, and United Bank for Africa plc (UBA) is a clear culprit of this. This is why this study is meant to discover how bank charges affect customer satisfaction.