BANK CREDIT FACILITY AND CUSTOMERS’ SATISFACTION

Statement of  Problem: It has been observed that banks have failed in instituting an effective and efficient credit policy in meeting customers demand for credit facility and this has resulted in reduction of customers seeking credit facility.

Many business have gone down the drain due to lack of fund collateral security which otherwise would have been averted. And as a result of this problem, the following questions becomes an issue to tackle, firstly does the credit policies operated by the bank favorable to customers? What effect does the credit policy have on the customers? It is an inescapable fact however that customers cannot do without these bank facilities. What are the factors which influence their decisions in obtaining these facilities?

Most of the credit policies instituted by the banks are derived from regulatory framework. However, regulatory frameworks have an impact on the credit policies of the bank. Not farfetched, the interest rate has an effect on customer’s satisfaction this is as a result of the fact that the higher the interest the lower the customer’s satisfaction and the lower the interest rate the higher the customer’s satisfaction.

 

1.3 Objectives of the Study

This research work seeks to determine how satisfied customers are with regard to bank credit facilities. The study aims at achieving the following objectives:

1. To determine the effectiveness of credit management with a view to meeting the requirements and satisfaction of the various categories of customer’s.

2. To examine the regulatory provisions of bank in terms of granting of facilities vis-à-vis customer’s requirement.

3. To find out whether bank customers are satisfied with the granting of loans and advances.

4. To examine the effectiveness and efficiency of bank credit management in commercial banks.

1.4 Research Questions

Below are important questions for this research work:

1. Is the credit policies operated by the bank favourable to customers?

2. What effect does the credit policy have on the customers?

3. What are the factors which influences customer’s decision in obtaining these facilities?

4. Can customers do without these bank facilities?

1.5 Statement of the Hypotheses

The following hypotheses will be formulated and tested in this study.

Hypothesis A

Ho: The regulatory provisions of banks in terms of granting of facilities are not favorable to customers.

H1: The regulatory provisions of banks in terms of granting of facilities are favorable to customers.

Hypothesis B

Ho: Bank customers are not satisfied with the granting of bank credit facility (loans and advances) procedures.

H1: Bank customers are satisfied with the granting of bank credit facility (loans and advances) procedures.

1.6 Scope of Study

This study covers bank credit facilities and how it can be used to promote or achieve better customer service delivery that guarantees customer satisfaction.

1.7 Significance of the study

This study will attempt to generate new interest in the development of bank credit facility and its customers’ satisfaction. Hence, customer’s satisfaction should be a major objective of any business establishment particularly financial institution. There is the need to evaluate the satisfaction derived by customers in the utilization of bank credit facilities. This study therefore serves as an attempt to undertake the evaluation of customer’s satisfaction.

Other interested parties that immensely benefit and find some treasures from this study include banks, financial institutions, investors, institutions of higher learning, scholars, regulatory bodies and future researcher wishing to research into these problems.