Factors influencing students’ choice of commercial banks : a case study of Makerere University

Abstract

There is intense competition in the market for financial services which requires banks to be more customer focused. University students represent an attractive segment of customers for commercial banks. Banks need to identify the factors that influence the choice of a commercial bank and focus on improving them. The objective of this study was to assess the factors that influence students’ choice of commercial banks in Uganda. It used primary data that was collected through an online questionnaire that was filled by 107 third year undergraduate students at school of statistics and planning which included 42.1% females and 57.9% males. From the study, 82.24% of the students were satisfied with their banks and only 17.76% were not satisfied with their banks. Analysis was done using frequency distribution, percentages and chi-square. From the bivariate analysis stage of the study, the bank’s brand, transaction time, interest rates, customer policy and convenience had an influence on the students’ choice of commercial banks while bank’s promotion strategy and relatives’ influence, gender, age, marital status and religion had no significant relationship with choice of a commercial bank. The results indicate that banks need to understand the factors that influence the students’ choice of banks and to what extent in order to develop the appropriate marketing strategies to attract them. The students should also take note of the most important factors to consider when choosing commercial banks in order to derive satisfaction and the utmost value for their money.