1

2 DEBRE TABOR UNIVERSITY

3

7 FACULITY OF BUSINESS AND ECONOMICS

8 DEPARTMENT OF ACCOUNTING AND FINANCE

9 ASSESSMENT OF THE CUSTOMER SATISFACTION ON ATM

10 SERVICE (CASE STUDY COMMERCIAL BANK OF ETHIOPIA,
11 DBRE TABOR BRANCH)

A RESEARCH PROPOSAL SUBMITTED TO THE DEPARTMENT OF

ACCOUNTING AND FINANCE IN

NAME ID: NO

1. NAHOM ASRESE ….…………………………………………………302/11

2. GONYE SAMUEAL……………………….………………….……….511/11
3. GIZACHEW MOLLA………………………………………….……….010/11
4. MELKAM BELAYE………………………….………………….………077/11
5. GETNET ZELALEM ……………………………………………………229/11

12 ADVISOR: MR: G/MARIAM AYICHEW (MSc.)

13 MAY :2013

14 DEBRE TABOR, ETHIOPIA

15

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6

7 ABSTRACT
8

9 One of the cardinal components of the banking industry is Automated Teller machine (ATM) service
0 and the extent to which customers feel comfortable to patronize(utilize) its service. This study
1 therefore investigates ATM service and customer satisfaction in commercial bank of Ethiopia. More
2 specifically, the study will be looked at ATM service customer satisfaction. The study uses primary
3 data collected from 30 respondents using random sampling methods. The results suggest that
4 customer’s satisfaction can be improved by convenience, security and privacy and reliability of the
5 ATM services.

6 The results further indicate that convenience, reliability have positive effects on customer
7 satisfaction. Also, security and privacy, ATM user fees, educational level and location of the ATM
8 are found to be the major factors that influence customers’ willingness to use a particular ATM
9 services in the study area. It will be recommended that, management of the various banks in the
0 region should use participatory approaches to ensure active involvement of its customers with
1 regards to ATM operations and policies safeguarding it usage by created awareness about the
2 service to customers through different media.

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Content
ABSTRACT.........................................................................................................................................i

ACRONYMS.....................................................................................................................................iii

CHAPTER ONE..................................................................................................................................1

INTRODUCTION...............................................................................................................................1

1.1. Back ground of the Study...........................................................................................................1

1.3 Statement of the problem............................................................................................................3

1.4. Objectives of the study..............................................................................................................4.

1.4.1 General objectives...............................................................................................................5.

1.4.2. Specific objectives.............................................................................................................5.

1.5. Research question…………………………………………………………………………....5

1.6. Significance of the study............................................................................................................5

1.7. Scope of the study......................................................................................................................6

1.8. Organization of the study...........................................................................................................6

CHAPTER-TWO..................................................................................................................................7

RELATED LITERATURE REVIEW..................................................................................................7

2.1. Introduction................................................................................................................................7

2.1.1. Overviews of use of ATM.......................................................................................................7

2.1.2. Benefits of ATM Banking to Customers................................................................................8

2.1.3. Challenges of ATMS (Automated teller machine).................................................................8

2.2. Customer Satisfaction Indicators.............................................................................................10

2.2.1. Customer Satisfaction...........................................................................................................10

2.2.2. Importance of customer satisfaction.....................................................................................11

2.2.3. Measuring customer satisfaction...........................................................................................12

2.2.4. Indicators of customer satisfaction........................................................................................13

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 2.3 Relationship between use of ATM and Customer satisfaction.................................................14

2.4 Empirical literature review........................................................................................................14

2.5 Conceptual framework for ATM services and Customer Satisfaction.....................................15

2.6 Research Gap............................................................................................................................16

CHAPTER- THREE...........................................................................................................................17

RESEARCH DESIGN AND METHDOLOGY.................................................................................17

3.1 Research design.........................................................................................................................17

3.2 Populations................................................................................................................................17

3.3 Sampling size and selection technique......................................................................................17

3.4. source of data and method of survey administration...............................................................18

3.5. Methods of data analysis, interpretation and presentation.......................................................18

CHAPTER FOUR...............................................................................................................................19

4.1. WORK PLAN and COST BUDGET.......................................................................................19

4.1.1 TIME AND BUDGET SCHEDULE.....................................................................................19

4.1.2 Time schedule....................................................................................................................19

4.1.2 Budget schedule.................................................................................................................19

REFERENCE……………………………………………………………………………………..…20

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 ACRONYMS
DTU- Debre Tabor University

ATM- Automated Teller Machine

CBE- Commercial Bank of Ethiopia

E-banking- Electronic- banking

ICT- Information Communication Technology

PIN- Personal Identity Number

POS- Point Of Sale

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6 CHAPTER ONE
7 INTRODUCTION
8 1.1. Back ground of the Study

9 Automated teller machine enables the customer to perform several banking operations without the help
0 of a teller(cashier), such as to withdraw cash, make deposit, pay bill, obtain bank statement, cash
1 transfer (business dictionary). The ATM made its debut at Barclays Enfield town branch in June 1967.
2 Its innovation is credited to British innovator John Shepherd-Barron. In 1970 just a few years the
3 introduction of the ATM the patent was granted for British engineer James Good fellow concept of
4 personal identification number that could be stored on bank card. this was land mark moment in the
5 growth of self-service banking as it allowed machines to verify the identity of customer without human
6 intervention.

7 Technology has significantly motivated increased network and range of service products offered by
8 commercial banks in recent times. Most services of commercial banks, such as electronic payments,
9 loans, deposits, or securities have become highly reliant on information and telecommunications
0 technology (ICT). (Sesebo and Alasa 2000), Solomon and Ajagbe (2014) argued that this could be
1 perceived as the reason commercial banks are the highest adopters of latest technology equipment.
2 However, as a result of the complication of banking services, the urge to hasten organizational
3 performance and enable them more accessible to customers is welcomed by banks. In another
4 dimension, Koyejo (1995) posited that with enhanced standard of services, the essential query that
5 appears is whether this process can provide the economic values required in the financial sector.
6 Regrettably, some authors think that not every rise in the satisfaction of clients will automatically
7 result to increased profitability for commercial banks, particularly, in circumstances where very
8 expensive investments in technology (Ajagbe et al.2015a) like automated teller machines are involved.
9 Koyejo (1995) submitted that automation is a significant fact of all human endeavours and should not
0 be underrated.

1 Nonetheless, commercial banks with automated services are likely to offer quicker and more efficient
2 services. In addition, the computer is an important and most advanced example of automation. Hence,
3 it is fast becoming an occurrence in business arena both in Nigeria and the world in general. The
4 computer has been variously defined by many authors based on their point of views. According to

1
5 Gray and Thomas (1983), the computer is a high-speed electronic mechanism which can carry out
6 computation including arithmetic and logical activities without human intervention.

7 The implications of the wider acceptance of an ATM service scheme would have incredible effects in
8 our lives, and very possibly, in the future development of electronic commerce as a means of distance
9 selling. ATM service can possibly serve to diminish the constant apprehension of consumers to
0 transacting online for fears that third parties will misuse their credit card details. The most important
1 development in payments in the last half century is the steady shift from paper to electronic payments.
2 The increased use of credit cards has made retail payments much more efficient, especially for those
3 seeking to make purchases with borrowed funds (Evans and Schmalensee 2005; Mann 2006)

4 Automation as the application of latest technology to day organizational operations. Office automation
5 nevertheless, implies the adoption of word processor, relevant for preparing reports that may require
6 passing through one or more amendments and for fabricating standard documents. It is relevant for a
7 well-structured financial economy as it plays a significant part in the functioning of commercial banks
8 and the financial sector as a whole. (Sesebo and Alasa 2000).

9 That the proper functioning of banks is dependent on among other things on how well and quickly
0 business clients could be attenattenbebe 2014) Furthermore, this is useful for the creation of ever-
1 increasing customer satisfaction that customers and financial experts have often asked for. Chukwudi
2 (2010) suggested that a bank with more efficient strategy of delivering banking services to customers
3 find itself in a position to realize better profits than its competitors.

4 The history of ATM can be traced back to the 1960s when John Shepherd Barron who was managing
5 director of De La Rue instrument invented the first ATM machine that machine used by Barclay bank
6 (Barclays bank in Enfield town in north London United Kingdom) No 27 June 1967 (Anderson 1993).

7 Now days as market is increasingly becoming competitive due to the opening of many private banks
8 every organization is striving to attract new customer and retain the existing ones this shows that
9 services provided by the bank are highly competitive business environment. In connection with this
0 study would try to assess the problem that the bank is exposed to in providing online banking services
1 such as ATM to its customer the gap between the customer expectation and service were being giving
2 by the bank has necessitated improvement of the service currently provided because customers are
3 always looking for reliable, flexible, cost effective and fast delivery of service (Birritu 2008).

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4 ATM was first introducing in Ethiopia in 2001 with the CBE (commercial bank of Ethiopia) being the
5 pioneers of this service to the banking sector (Gardachew, 2010).

6 At this time CBE is diversify ATM machine to the different branches in order to success customers
7 satisfaction. All banks in Ethiopia are too late to move with technological advancement and they
8 should clearly chart out the time schedule for their integration and technological advancement. Every
9 bank customer is highly dissatisfied by the disappointing status of financial development in Ethiopia.
0 Even the time wasted in traveling for search of bank branches and the long waiting time to access the
1 account is really disappointing. Banking in Ethiopia faces numerous challenges to fully adopt and
2 adapt ATM service applications and seize the opportunities presented by ICT applications in general.
3 The purpose of this paper is to assess the customer satisfaction on ATM service in the case of
4 Commercial Bank of Ethiopia (CBE) in Debre tabor branch.
5

6 1.3 Statement of the problem

7 Commercial bank of Ethiopia product lines are actual services. The bank is expected to meet the
8 growing needs of its customers by providing effective and efficient services for its major activities in
9 comprehensive, profitable and satisfactory manner. Online banking services help to customers to be
0 able to Transfer of funds between accounts, receive and pay bills (without check writing envelops or
1 stamps), Access account round the clock even weekends and See balances online and find out whether
2 cheeks as deposits have been cleared. (Aynew hailesilasie, adiss ababa,2009)

3 CBE as a service provider faces different problems such as infrastructure of information

4 communication technology (ICT) directly affects how managers decide, how they plan and what
5 products and services are offered in the banking industry.

6 It has effect on the speed and quality of service delivery. Weak Telecommunications supply, this can
7 act as a significant effect on development and service of the customer these include increased
8 transaction costs for business, reduced efficiency of markets; and lower productivity, amongst others.
9 The existing weak telecommunications infrastructure in Ethiopia acts as a severe constraint on the
0 development of the Ethiopian bank service and imposes additional costs on business activities
1 (Dominique Baron, 2010).

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2 Here in Ethiopia there is frequent power and telecommunication service interruption. These basic
3 service interruptions have greater impact on the operations of Commercial Bank of Ethiopia. When
4 there is interruption in telecommunication, it directly leads to frequent ATM breakdowns, The inability
5 to access funds at other branches, referrals to branches due to network breakdown as it affects the
6 Automatic Teller Machines, POS machines, and in general the whole activity of the bank if so the bank
7 would fail to achieve its strategic goals. We can see the service of ATM in our campus. Cannot offer
8 complete service all day as a result of all above problems and other.

9 ATM service is enabling customers have 24/7 access to their money and improve customer
0 satisfaction. Cash machines are relatively new to Ethiopia but their number is growing quickly with
1 banks eager to easy access for their customer. Fair distribution of ATM is areas convenient to the
2 customer due the convenience of bringing banking closer to the customer However despite the banks
3 effort to improve access for its customer by increasing the number of machines the network failure due
4 to service break down from the country sole telecommunication service provides Ethio telecom and
5 internal network problem are the challenges faced by commercial bank in success full service delivery
6 and distribution of ATM throughout the country (Gezahegn 2015).

7 The prospect of ATM service on the customer satisfaction will be expected to easy to use and the
8 service will be faster than human teller in the banking hall and they believe to have improved the
9 operational efficiency of the bank. (Gerrard and Cunningham, 2006). Banking in Ethiopia faces
0 numerous challenges to fully adopt and adapt ATM service applications and seize the opportunities
1 presented by ICT applications in general. (Agbolade, 2011).To sum up, the factors that have been
2 effect of ATM service on customer satisfaction positively like; easy to use, faster than human teller
3 performance of efficiency, accessible, performance of assurance, reliability, safety and convenience as
4 well as has adverse effect like; network failure, lack of money from machine, retention of card in
5 machine, security risk, location of ATM service is unavailable and fixed money to withdraw(able to
6 withdraw above birr 50.00 and cannot like birr 60,90,110….). This paper tries to assess the customer
7 satisfaction on ATM service in case of Commercial bank of Ethiopia in Debre tabor branch.

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9 1.4. Objectives of the study

0 1.4.1 General objectives

1 The general objective of this study is to assess customer’s satisfaction with the ATM services of the
2 Commercial Bank of Ethiopia

3 1.4.2. Specific objectives

4 Based on the above general objective the following specific research objectives are developed:

5  To measure the standard of ATM service in CBE.

6  To measure the convenience of the ATM location related with users.
7  Assess the sophistication level of ATM service by CBE.
8  Assess the quality of ATM service on CBE for customer satisfaction.

9 1.5. Research questions

0 The study tried to answer the following research questions.

1  What is the standard of ATM service in CBE?

2  What is the convenience of the ATM location related with users?
3  How is the sophistication level of ATM service by CBE?
4  How can measure the quality of ATM services for customer satisfaction?

7 1.6. Significance of the study

8 The study finding will be significant for both the researcher and the organization (Bank). For the
9 organization (bank) it is important to show its strength and weakness as well as the satisfaction level of
0 customers. This means that, after completed the study the bank can use the researchers finding as an
1 input to understand the satisfaction level of customers and take corrective actions for the customers
2 complain or dissatisfaction.

3 Not only for the organization but also the research important for the researcher to develop the
4 researcher knowledge and skill on how to conduct research and also it is important to develop the
5 researcher’s knowledge with regard to assessing customer satisfaction on the bank. In addition to this,
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6 the study is important to the students as the pre- request for graduation and to understand the ATM
7 service on customers satisfaction and used to adapt different challenges when conducting another study
8 for the future.
9

0 1.7. Scope of the study

1 For the reason that, the research on a large basis needs much funds as well as time and manpower to
2 survey all service of CBE so it focuses only on ATM service. And the study will be restricted to the
3 customer of Debre tabor university department of business and Economics student. This study is
4 covered the identification of proper locations of ATM services to which it is convenient for customers
5 and the area of investigating quality of the service, security of the service and attitude of the customers.

7 1.8. Organization of the study

8 The study will have been organized into four chapters. The first chapter deals with
9 the introduction about topic which includes: background of the study, statement of
0 the problem, Research of the questions, Objective of the study, significance of the
1 study, scope of the study, the second chapter consist the literature review .

2 The third chapter includes the term research methodology, description of study,
3 research design, Types and Sources of data, data collection techniques, Data
4 sampling, Data analysis and interpretation. Finally, The fourth chapter consist with
5 work plan and cost budget

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5 CHAPTER-TWO
6 RELATED LITERATURE REVIEW
7 2.1. Introduction

8 This chapter will review literature related to use of new technologies and operational efficiency of
9 banks. It looks at what different authorities have observed and recommended pertaining to about the
0 use of new technologies and the operational efficiency of banks and shows the gaps that a left unfilled
1 by past scholars as well as reflecting the attempts to bridge these gaps. The review is presented under
2 themes that will have been developed from the objectives defined in Chapter One.

3 2.1.1. Overviews of use of ATM

4 An ATM is simply a data terminal with two input and four output devices. Like any other data
5 terminal, the ATM has to be connected and communicate through a host processor which is analogous
6 to an internet service provider in that its ATMs network become available to the card holder
7 (Byaruhanga 2001)-2018.

8 The banker (1999) explains ATMs as specialized computer terminals which are continuously on line
9 connected to the banks central computer to provide a number of facilities According to the Bureau of
0 Statistics of United States (2001)-2018 automated teller machines allow customers to carry out bank
1 transactions without the assistance of the teller. ATMs are a cornerstone of self – service banking.
2 They give vending – machine convenience to customers to the effect and withdrawals of cash –
3 transactions that have historically played a key role in the banking branching decisions (Caba, 2001).

4 According to Bauer et al (2006) banks introduced ATMS in order to avoid mistakes manual systems
5 improve on security of both the bank and their customers, reduce the time taken for customers to finish
6 a transaction and increased the banking time of their customers.

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7 2.1.2. Benefits of ATM Banking to Customers

8 Credit cards are useful in major cities and luxury hotels but smaller establishments will not accept
9 them. If you can use a credit card make sure you ask about the exchange rate and fees charged visa and
0 master card are generally more widely accepted than any other credit card.

1 Lovelock (2018) states that ATMs saves time: one does not need to come to the bank and wait in a
2 queue or fill some paper work all the times when ones want to withdraw cash. According to Joseph and
3 Stone (2003), in his managerial auditing journal ATM are also easy to use. That is, the machine guides
4 the customer through each step all one has to do is to follow instructions on the screen. To use the
5 machine the needful convenience is increasingly catered for by ATMs.

6 According to Goldrick (2009), one can do his/her banking 24 hours a day 7 days a week at any Auto
7 Bank. He added that the overriding perceived benefits of ATMS for the customers is the attribute of
8 convenience followed by the perceived benefits of reliability and suitability, which in effect implies a
9 measure of convenience they are also important for their accuracy.

0 According to Rick Roy (2000) the evolutions of ATMS have enabled banks move staff from man done
1 tasks to more technical areas. This is very important as competition increases and technology develops
2 very fast, growing competition calls for fast development of products and services to day ahead, the
3 fast

4 2.1.3. Challenges of ATMS (Automated teller machine)

5 With increased use of ATMs, delivery of financial services has come with new service provides. In
6 more sophisticated economies than, banks, super markets, and telecommunication banks provide loan
7 payments services, insurance services, for commercial banks in therefore, this is something worth
8 emulating. According to Dan Wright and Walls (2018). One problem with ATM is that they are now
9 the greatest source of customer complaints part customers argue that were not make by them whilst
0 banks would never complain that their machines are infallible, they do argue that these withdrawals are
1 usually made by friends or family members or pin Salome (2021). ATM banking services are mainly
2 found in urban areas, the population in rural areas is largely serviced by micro finance institutions
3 which are not as sophisticated as the commercial banks. This is a drawback since population is
4 predominantly rural.

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5 Coupled with these attitudes, cultural practices and segments of the potential banking population, they
6 should be just right for the people to be able to take advantage of the banking services, albeit at a more
7 sophisticated level.

8 One of the biggest concerns about ATMS security (Mukasa 2003). He says this is the same for
9 provider and customers. There should be protection from hackers and fraudsters.

0 Customers need to be sure that passwords are secure and information and transaction are safe.
1 Development of secure control is a big challenge for the service providers. Banks should use
2 appropriate techniques to mitigate both external and internal threats to their ATM system in order to
3 increase customer satisfaction.

4 Schaecher (2000) noted that the lack of face to face customer relations in ATM development of ATM
5 technology has led to reduced costs, and therefore to increased efficiency in service delivery the
6 ultimate effect is improved profitability and increased customer satisfaction.

7 Tony (2022) pointed out that ATM provides the bank an opportunity to serve customers and market
8 them without physically open. Marketing and advertising material can be positioned to acquire new
9 customers, allow for existing to apply for new products. The bank is able to obtain a lot of information
0 regarding customers on their ATM account usage and once gets used to transacting with the bank at
1 any time of the day, or from anywhere it gives the bank a loyal customer hence adding value to the
2 service. Solome Lumala (2000), noted that the use of ATM service delivery has enabled banks to cover
3 a wider geographical area than would otherwise be at an actual branch. Banks are able to provide
4 banking services to non- residents as well. While this has its disadvantages especially as banks lose the
5 benefit of “know your customer.” It increases the service area and therefore, profitability for the
6 institutions.

7 According to Mark et al (2020), the emergency of ATM standalone kiosks has incredibly reduced the
8 need the fore direct link between the customer and the branch. ATM banking gives the customer a
9 wide range of financial services that could substitute those provided at the branch; for example, the
0 easy accessibility of the ATM can also be used for dispensing other service like moving and parking
1 tickets or for paying bill possible to pay bill of national water and sewerage corporation, electricity
2 (UMEME) and telecommunications.

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3 Banking increases the risk of money foundering Banks in more advanced economies use a combination
4 of checks such as electoral register number license, recently utility bill where possible, certified
5 photocopies must be provided. In Spain ATM use is restricted to customers already in a traditional
6 relationship with the banks. Banks have to invest in more vigilant measures especially, since
7 automation (auto bank) makes prom detection of money laundering more difficult.

8 During August 2003, the banker’s association (UBA) launched a campaign to sensitize the public
9 about money laundering in addition: commercial banks have introduced rigorous account opening
0 requirements similar to those in more developed economies. In the article “keep the ATM card in
1 check”, lacked financial discipline cash strapped. She ahead and interviewed some banking experts
2 who said “having ATM is handling hard it’s for cash people to starve at hand, themselves when they
3 have money in their accord of centenary rural development bank. Therefore, because ATM points are
4 everywhere. Richard byarugaba the managing director of Nile bank pgs. 19).

5 According to Salome (2000) banks that engage in ATM use are likely to have a higher liquidity risk
6 rising from volatility caused by customers switching accounts as they take advantages of better rates
7 and services elsewhere. This calls for closer liquidity management and adequate assets to act as
8 collateral should borrowing become necessary.

9 2.2. Customer Satisfaction Indicators

0 2.2.1. Customer Satisfaction

1 Customers are those who buy and use the organizational services and products to solve their problems
2 and get good feelings and they are the kings (Waswa Balunywa, 1995). According to Molhatra (2004),
3 a customer is body for whom you satisfy a want or a need with some form of payment. The payment
4 may be money, time, or it may be good will; quality of the product or service, but there is some form
5 of payment. Customers are classified into two classes namely; potential and actual customers. An
6 actual customer is the one the company knows at the material moment while potential customer is one
7 who is time he/she makes up his/her mind Castleberry (2000) argue that customer satisfaction cash.
8 Banks should treat their employees like customers, and their customers like employees. This will lead
9 to better results improved quality of services, higher productivity, lower costs and greater opportunity
0 for error recovery.

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1 According to Sesser (2000), the customer is king, as this doesn’t company’s cost a growth and success
2 is not simply about meeting budgets or cutting cost. but about engaging the company in finding world-
3 class solutions for customers concerns. In practical terms, every company needs to develop models
4 where by the customer focus is integrated more fully into their way of doing business.

5 It’s this kind of customer focus that help a business stay close to its customers: committed, focused,
6 and conscious of the common good. when a company creates employee value, this leads to customer
7 value which creates long term investor we need value respond, more time thinking because customers
8 unless the customer focus in recognized visual and nurtured, customer employee centricity will be is
9 short- lived in any organization (Susan, 2010).

0 Customer satisfaction: is a reflection of organizational competency or its capability in the delivery of

1 services to customers. It is one of such parameters used to measure performance or competency of an
2 organization (Fassnacht and Koese, 2006). Organizational completeness that enable customer
3 satisfaction can be planned, developed and continually updated, and sustained through continuous
4 learning by firms subject to forces of constraints such as management strategy. primary markets, and
5 economies of scope, accumulated technological basis, organizational culture and government policy
6 customer satisfaction is the fulfillment of customer expectations and meeting their needs. The of
7 customer satisfaction depends on the extent service are fulfilled (Cabas, 2001)

8 Kotler et al (2000), defines customer satisfaction as the extent to which products or services perceived
9 performance matches buyer’s expectations. If it falls short of the expectation, then the customer is
0 dissatisfied. Normally, a complete customer satisfaction is a key to customer loyalty and superior long-
1 term financial performance. Even in markets with a relatively few or no competitors, providing
2 customers with outstanding value may be the only way to achieve and sustain customer satisfaction
3 and loyality (jones & Sasser 1995).

4 2.2.2. Importance of customer satisfaction

5 Ranaweera & Prabhu (2003), observe that customer satisfaction, loyalty and retention might be the
6 only sustainable competitive advantage in the challenging economic times. They defined customer
7 loyalty as a customer’s sustained commitment to a company as demonstrated by repeat purchases,
8 increased wallet shares and positive word of mouth referrals.

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9 The key to customer loyalty is customer satisfaction and customer satisfaction begins with providing
0 customers with superior service. The research indicated that when a company commands such loyalty,
1 the benefits include, but go considerably beyond incremental value.

2 The evidence from this study is clear Banks receive proven bottom line benefits from establishing
3 long- term customer relationship and those banks that invest strategically in improving customer
4 satisfaction and loyalty can correspondingly expect significant aims in profitability and other financial
5 measures.

6 A stronger brand; in difficult economic times, a loyal customer will first turn to the organization they
7 trust. Trust should be key element behind your brand. The brand represents an emotional trust bond
8 they have formed with your organization (Shamsdouha, Chowdhury, & Ahsan,2006). Loyal/Satisfied
9 customers purchase more and more often. It costs much less money for you to strengthen the
0 relationship an existing customer, than to begin a new relationship with a new customer (Eberhard,
1 2021). Satisfied customers have higher response rates than non-loyal customers. You spend less money
2 on loyal customers to achieve the results (Gerrard and Cunningham, 2023).

3 Organization with satisfied and loyal customers can more readily ask and receive more accurate
4 responses from their customers on what they really want. This not only reduces the cost to develop, but
5 improves “time Long & Mc Mellon, to 2005) Market” As can be drama deduced from the ongoing
6 discussion it is evident that organizations involved in service delivery need to focus much on the
7 strengthening their customer relationship through creasing a culture of continuous service
8 improvement.

9 2.2.3. Measuring customer satisfaction

0 Customer satisfaction is the state of mind that customers have about a company and how their
1 expectations have been met exceeded over the life time of the product or service. The achieve of
2 customer satisfaction leads to company loyalty and product repurchase (Gerrard and Cunningham,
3 2021)

4 Lineberg (2026), explains that measuring and achieving customer satisfaction involves; formulating
5 and priorizing the organization’s objectives and defining their relevant key performance indicators
6 (KPIs) and targets; identifying each departmental benefits and determining which ones are best

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7 positioned to contribute to the objectives KPI target’ rationalizing and optimizing the project portfolio
8 to ensure the aggregated project benefits achieve the objective target KPI.

9 2.2.4. Indicators of customer satisfaction

0 Iqbal et al (2003), states that a market share means an indicator of how well a firm is doing against its
1 competitors. They further explain that unit market share is the percentage of the total market unit sales
2 that is attributed to a specific institution in the market or business. It is therefore equal unit sales or
3 total market unit sales times % while revenue market share is the percentage of total revenue generated
4 in the market that is attributed to a specific business entity. It is expressed as; Revenue market share =
5 Sales Revenue divided by Total Market revenue.

6 Modigliani and Miller (2021) explain that knowing the business market share helps managers evaluate
7 both primary and selective demand in their market. That is it enables to judge not only market growth
8 or decline Rosenberg (2005) reveals that marketers need to be able to translate sales into market shares
9 because this will demonstrate whether forecasts are to be maintained by growing the market or by
0 capturing share from competitors. The latter will almost always be difficult to achieve. Market share is
1 closely monitored for signs of change in the satisfaction about ATM service quality. These factors
2 include costs involved in the use of ATM, and efficient functioning of ATM Joseph and Stone (2003)
3 examined the United States customers perception of – friendly. ATM convenient quality locations,
4 secure and found positions, and the numbers of ATM provided by the banks are essential dimensions
5 of ATM service quality. In a case study of Botswana, Mobarek (2001) established speed of operation,
6 and waiting time as the important predictors of ATM service quality.

7 Researchers have divergent views about the use effectiveness of ATM, Stemper (1990) stressed the
8 positive dimension of ATMS based on freedom of transaction.

9 Effective service delivery in ATM system guarantees quality excellence and superior performance and
0 provide autonomy to the customers (Lovelock, 2020), focused ATM delivery system that fulfills their
1 needs and maximize operational performance are essential dimensions for bank to achieve and sustain
2 competitive advantage.

3 Dilijonas et al., (2020) examined the essential aspects of ATM service quality in Baltic States. They
4 identified essential resources (Adequate number of ATMS, convenient and secure location and user –
5 friendly system); important dimensions of operation of ATM (Maximum speed, minimum errors, high
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6 uptime, cash backup); and value- based aspects (quality service at reasonable cost, and maximum
7 offering to cover maximum needs of customers) as vital facts, based on the prior studies, Al- Hawari et
8 al., (2079)compiled a list of five major items about ATM service quality that include convenient and
9 secured locations, function of ATM, adequate number of machines and user-friendliness of the systems
0 and procedures. An empirical study found that these items constitute important aspects of ATM service
1 quality.

2 Competitive landscape, and frequently drive strategic of tactical action.

3 2.3 Relationship between use of ATM and Customer satisfaction

4 Use of ATM has become extremely popular among customers as convenient mode of transactions. The
5 technological innovation has transformed the banking Business. Banks are aggressively adopting this
6 mode. The advantages of using ATM have given new impetus in dimension of service quality and
7 banks are offering new choices to customers. Cabas (2001) noted investment opportunities, reduction
8 in costs, satisfaction of customer and competitiveness as motives to install and add new ATM to the
9 existing network. Mouthinho (1992) established that ATM facility resulted in speed of transaction and
0 saved time for customers. Literature review indicates different dimensions of ATM service quality.
1 Lovelock (2000) identified secure and convenient location, adequate number of ATM, user- friendly
2 system, and functionality of ATM. Davies et al, (1996)

3 2.4 Empirical literature review

4 Organizations are aware that service quality provides strategic competitiveness in a dynamic Business
5 environment. Previous studies provide significant relationship between service quality and firm’s
6 Performance based on improved productivity, increased market share, enhanced customers’ attraction
7 and loyalty, improved staff morale, and sustained profitability (Lassar et al., 2000). Stemper (1990)
8 stresses the positive dimension of ATMs based on freedom of transaction.

9 Effective service delivery in ATM system guarantees quality excellence and superior Performance and
0 provides autonomy to the customers (Lovelock, 2000). Yavas, Benkenstein and Sultrier (2004) argue
1 that customer focused ATM delivery system that fulfills their needs and Maximize operational
2 performance is an essential dimension for bank to achieve and sustain Competitive advantage. Davies,
3 Moutinho and Curry (1996) examine the factors that influence customers’ satisfaction About ATM
4 service quality. These factors include costs involved in the use of ATM, and Efficient functioning of
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5 ATM. Joseph and Stone (2003), through focus group study in the United States, found that easy
6 access to location, user-friendly ATM and security, are important factors That influence majority of
7 bank customers’ perception of ATM service quality. another study In Bangladesh, Shamsdouha,
8 Chowdhury and Ahsan (2005) found that 24 hours service, Accuracy and convenient locations are the
9 main predictors of customer satisfaction. Mourinho (1992) examines the relationship between the
0 dimension of usage rate and performance expectation with customers’ satisfaction with ATM services.

1 The results indicate that usage rate has a negative association with customers’ perceived prolonged
2 satisfaction whereas performance expectations are found to have positive and significant effects on
3 customers ‘satisfaction. Howcroft (1991) notes that dissatisfaction among customers is associated with
4 frequent Interruption and breakdown of ATM. Intense competition and technology-based new services
5 are Shaping customers’ loyalty. These have resulted into switching of banks by customers based on
6 Competitive services (Lewis & Bingham, 1991). Michael (2001) found that location of ATMs,
7 increasing number of ATMs, and diversified service offering are associated with switching of Banks.
8 ATM is one type of innovation that can mechanically accept deposits, issue withdrawals, transfer funds
9 between accounts, and collect bills. It has highlighted the relationship between Banks and their
0 depositors, as well as the level of quality of banking services (Komal & Singh 2009). Joseph and Stone
1 (2003) conducted a research and find out that secure and convenient Location, adequate number of
2 ATM, user-friendly system and functionality of ATM play Important role in customer satisfaction.
3 Dilijonas, Krikscuiunen, Sakalauskas and Simutis (2009) On the other hand mention that adequate
4 numbers of ATMs, convenient and secure location, and User-friendly system, speed, minimum errors,
5 high uptime, cash backup, cost and service Coverage Are essential service quality aspects of ATM
6 service.

7 2.5 Conceptual framework for ATM services and Customer Satisfaction

8 Customer satisfaction (dependent variable) depends on independent variables (the prospect and
9 challenges of ATM services which include the will be expect to the service have ease to use, the
0 service is faster than human teller, performance of efficiency, performance of reliability,
1 accessibility, performance of assurance, safety, convenience and have same challenges like:
2 network failure, security risk, lack of money from the machine retention of ATM cards fixed
3 money to withdraw and location of the service is un available for the customer’s.

4
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5

ATM service

Network failure
Easy to use
Lack of money from the
Faster than human teller
machine
Performance of efficiency
Retention of cards in the
Accessable machine

Performance of assurance Security risk

Reliability Location of ATM service

is unavailable
Safety
Fixed money to withdraw
Convenience

Positively related Customer Negatively related

Satisfaction
6

7 Figure 1: Conceptual Framework for ATM services and Customer Satisfaction

8 2.6 Research Gap

9 The review of literature suggests that most of the studies will have been done on issues related to ATM
0 service in our world countries like USA and the like. However, what makes different the present study
1 from the previous research is that not sufficient work has been done in Ethiopia with regard to ATM
2 service and customer satisfaction issues. The present study intends to know the determinants of
3 customers’ satisfaction in quality service of ATM regarding Ethiopian context specifically Debre tabor
4 branch, and the researcher will be tried to consider the absence of the use of alternative local language,
5 and availability of enough ATM machine in the organization. Secondly the range of time also make the
6 research different from the previous study.

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7 CHAPTER- THREE
8 RESEARCH DESIGN AND METHDOLOGY
9 This chapter explores the methods to use in data collection and their justification. It covers research
0 design, population and sample size, sampling technique, source of data, collection methods and
1 methods of data analysis.

2 3.1 Research design

3 The research design is a plan or a strategy used to get the expected study results (Kothari, 2004).
4 Research design is categorized into different types depending on the nature of the study, which
5 include case study design, descriptive design. These studies therefore use descriptive study design
6 because research involve data that describe events and then organizes tables and describe the data
7 collection. Descriptive method of research design helps to clearly describe relevant aspects of the
8 phenomenon of interest about particular individual, group or situation.

9 3.2 Populations

0 The study will only targeted ATM service users. Probability sampling system specifically random
1 sampling technique will use during the study. This is because of the difficulty to take the total
2 number of ATM service users. And the researcher targeted only those respondents who are DTU
3 Students department of business and economics.

4 3.3 Sampling size and selection technique

5 A sample of 30 ATM users of CBE will select. The selection will do through random sampling
6 technique. The researcher will use random sampling technique, because it is difficult to get the complete
7 number of respondent from Commercial bank of Ethiopia ATM service customer at once. Due to these
8 random sampling techniques is appropriate for this study and also this study to overcome time and
9 budget constraints, to direct the study as per both the researcher and customer of the bank. Therefore in
0 random sampling everyone has an equal chance of inclusion in the sample. It is considered ‘fair’ and
1 therefore allows findings to be generalized to the whole population from which the sample taken.

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2 3.4. source of data and method of survey administration

3 The study will use both primary and secondary source of data. The primary data will collect from
4 questionnaire and personal interview.
5 The researcher will be using the questionnaire so as to get adequate information from the respondents
6 and it is covering a small number of populations. By using structured questionnaire adequate
7 information will collect. Thus, the researcher will be use adequate information from customers of
8 CBE. The researchers also collect a secondary data from the related review of other researcher, books
9 bank manuals and other reference.

0 3.5. Methods of data analysis, interpretation and presentation

1 After the data collection activity accomplished the data analysis comes. For the user understanding of
2 this research the collected data through structured questionnaire were analyzed and arranged orderly in
3 table and graph forms. The researcher is integrating the study findings in such a manner that the final
4 user of the research to be a clear idea of the qualitative and quantitative meaning of the data.
5 Furthermore, the researcher is believing that tables and percentage findings the research findings hence
6 it uses to facilitate the summarization and communication of the meaning of the data. Because tables
7 and percentages are used to summarize and include the issues which is raised in the questionnaire and
8 put together in a short and precise manner.

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0
6 CHAPTER FOUR
7 4.1. WORK PLAN and COST BUDGET

8 4.1.1 TIME AND BUDGET SCHEDULE

9 4.1.2 Time schedule

0 No Activity Mar AP May June

1 Topic selection Xx
1 4.1.2 Budget schedule
3 2 proposal development Xx The study will contain the
4 following different types of
3 Collection of useful Xx
5 expenditures that will incur in
material
6 the whole course of research

4 Data collection Xx
Item Unit No Amount Total Cost Remark
5 submission of proposal Xx

1 Pen Pac. 1 75 75

2 Computer Pac. 2 160 320

(printing) paper

3 For telephone purpose . Birr 70

4 For internet access Birr 150

5 Photocopy expense Birr 140
Total 755

8
9

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2

4 REFERENCE
5

6 Ajagbe, A.M., IsmaiL., k., Isiavwe, D.T. and Ogbari, E. I. M. (2015a) Barriers to Technological and
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9 Al-Hawari, M., and Ward, T. (2006). The effects of automated service quality on Australian banks’
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1 and Planning, Vol.24, No.2, pp.127-147

2 Gezahegn Balcha (2015): Assessment of ATM banking and customer’s satisfaction in Ethiopia banks
3 case of Addis Ababa city. Addis Ababa university school of commerce, unpublished.

4 Kothari C. R. (2004). Research method: methods and techniques, university of Rajasthan. New Delhi,
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6 Koyejo A. O. (1995). Computerization in central bank of Nigeria (CBN), the challenges and response.
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8 Kumbhar Vijay M (2011), “Customer satisfaction in ATM service: an empirical evidence from public
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0 Musiime and Biyak, (2010), loyalty is a combination of intentional repurchase behavior and
1 psychological attachments of a customer to a particular service provider

2 Oliver, R- L- (1997) satisfaction: A Behavioral perspective on the consumer. New York Graw-Hill

3 Sultan Singh, Ms. Komal (2009), Impact of ATM on Customer Satisfaction (A Comparative Study of
4 SBI, ICICI & HDFC bank), Business Intelligence Journal -Vol. 2 No. 2

5 Sebo, J. and Alasa, B (2000). 30 most solid banks: celebration of excellence. The Guardian Friday
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7 Selomon, O. and Ajagbe, A. M ( 2014). Internet banking adoption in nigeria: A Literature

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8 review 2014 international conference on customer, intelligent computing and education technology,
9 march 28th, Hong Kong. Published by Taylor and Francis group

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