STUDY THE RELATIONSHIP BETWEEN SERVICE QUALITY AND CUSTOMER SATISFACTION IN PRIVATE COMMERCIAL BANKS OF ETHIOPIA: THE CASE OF SELECTED PRIVATE COMMERCIAL BANKS AT DIRE DAWA ADMINISTRATION

Customer satisfaction is important for the success of banks and financial institutes. The quality of service has become an aspect of customer satisfaction which transforms itself to a better performance. This study pursued to study the relationship between service quality dimensions and customer satisfaction in private commercial banks of Ethiopia. Tangibility, reliability, responsiveness, empathy, and assurance were considered as five dimensions of service quality(Parasuraman, Zeithmal, Berry, 1985). A self-administered questionnaire with 5 point Likert scale has been used to collect the data from 375 sample customers of private commercial banks. Data has been analyzed by using SPSS-v23 software. The spearman correlation coefficient between service quality dimensions and customer satisfaction was varied between 0.587 and 0.751. Result of the study showed that tangibility, reliability, responsiveness, assurance and empathy had significant relationship with customer satisfaction.