The impact of economic recession on customer loyalty in Uganda’s finance sector: A case study of STANBIC Bank, Mbarara Branch
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The main objective of this study was to examine the impact of economic recession on customer loyalty in Uganda’s financial sector, with a case study of Stanbic bank, Mbarara Branch. The study further had three specific objectives which were; to assess the effect of economic recession on customer loyalty, assess the effect of economic recession on customer’s savings and also find out the challenges that Stanbic Bank faced during economic recession in retaining customers. The study applied a non-experimental design called descriptive survey research design. This study used a non-probability kind of sampling called purposive sampling. Purposive or judgment allows the researcher to make a choice of cases which according to his/her own view/opinion or judgment that give information which is in line with objectives stated. The questionnaires to be administered to the customers of Stanbic Bank in Mbarara was both open ended and close ended. Once the administered questionnaires are gathered, the data analysis was done according to the dissertation. Thus, all the data collected from respondents were analyzed based on descriptive statistical analysis by using the SPSS software so as to obtain a more statistical analysis of the study. The study results Study results showed that the major respondents of this study were female (73.6%). Study results also showed that majority of the respondents who took part in this study were married (69.4%) while others were single (30.6%). Furthermore, the results of study showed that most of the respondents who took part of the study had acquired university/tertiary (87.5%) education as the highest level of education. A Pearson’s correlation results showed that there is a strong positive significant correlation between economic recession and customer loyalty (rp =0.611, n = 72, p <0.05). A Pearson’s correlation results also showed that there is a weak positive significant correlation between economic recession and customer’s savings (rp =0.239, n = 72, p <0.05). Moreover, the regression results showed a statistically significant relationship at (at 5 percent level of significance) between the interest rates on borrowing, time of service and the levels of customer loyalty in this study since its P-value is less than 0.05. The study further recommends service quality, trust and reputation are three important routes to customer loyalty for most service industries, moreover in keeping customers.