Challenges in the Era of Globalization - iaabd

Convenient
location of
banks
Challenges in the Era of Globalization
Edited by Emmanuel Obuah
In West Africa, Owusu-Frimpong´s (1999) study showed that Ghanaian consumers valued efficient
services, favorable interest rates on savings accounts, influence from peers are very important in deciding
which bank to patronize. Omar´s (2007) study shows that Nigerians value time highly and as such would
prefer fast and quality services. In contrast to Tan and Chua´s (1986) work, Hinson et al. (2009) study
reveals that bank customers view proximity/accessibility as the most important factor in the opening and
maintenance of accounts with banks in Ghana whereas peer recommendations appear not so important.
However their finding on convenience is in agreement with that of Blankson et al. (2009) However, the
role of word of mouth as an effective tool to communicate banks services (Owusu-Frimpong, 1999) is not
supported by Hinson et al. (2009). Blankson et al. (2007) researched on the determinants of banks
selection in USA, Taiwan and Ghana shows that convenience, competence, and no bank charges were
consistent in all the three countries surveyed. The competence and quality service factors are evident in
Omar (2007). The convenience factor was also present in Hinson et al (2009) as well as Omar (2007) as
proximity. Then the ‘no charges finding’ was corroborated by Owusu-Frimpong (1999) sensitive to price
and sensitivity to high rate of interest in Omar (2007).
Theoretical framework
We adopted the decision hierarchy model for the selection of banks from Ta & Har (2000). The decision
hierarchy for the selection of bank is based on nine criteria for deciding on a bank. The model presents
three elements; respondents to make a decision, the nine criteria that influence decision and the decision
alternatives (i.e. banks in Ghana). The first component of the model requires respondents to make a
decision to select a bank. The second element presents the nine criteria with which respondents use in
selecting a bank, in other words the determinants of bank selection. The final component is the banks in
Ghana which the respondents are to choose influenced by the nine criteria. Our goal is to find out whether
these criteria are the same used by undergraduate students in Ghana or otherwise. The model gives us a
framework why undergraduates select a bank. Thus will serve as the basis for analyzing the reasons why
undergraduates select a particular bank over the other. This is illustrated in fig. 1 below.
High interest
rate (savings
account)
Overall
quality of
service
DECISION TO SELECT A
BANK
Low charges
on services
banks
Interest rate
on loans
BANKS IN GHANA
Long
operating
hours
Rec. by
parents &
friends
Availability of
undergr
557
Availability
self-service
facilities