Service Quality Gaps In Private Sector Banking: An Empirical Study From The Customer’s Viewpoint

Abstract

The rapid growth of private sector banks in India has significantly reshaped the banking environment; however, discrepancies persist between customer expectations and perceived service quality. This study investigates this service quality gaps in selected private sector banks in Chennai using the SERVQUAL framework, which assesses five dimensions: Tangibles, Reliability, Responsiveness, Assurance, and Empathy. Data were collected from a purposive sample of 200 bank customers through a structured questionnaire employing a five-point Likert scale. Gap analysis revealed that Empathy exhibited the largest shortfall, followed by Reliability and Responsiveness, whereas Tangibles and Assurance showed relatively smaller gaps. Attributes with the highest gaps included personalized attention and understanding of customer needs, while the lowest gaps were observed in safe transactions, modern equipment, and courteous staff. Stepwise multiple regression analysis demonstrated that Empathy (β = 0.365), Reliability (β = 0.285), and Assurance (β = 0.215) significantly influence overall service quality, collectively explaining 48.7 per cent of the variance. These results indicate that, despite strong performance in infrastructure and professionalism, private banks need to enhance human-centred services to improve customer satisfaction, loyalty, and retention.