Statement of the problem

The understanding of customer’s needs within the current competitive banking industry

has become an important factor for service provider’s success. Owing to that, companies have

moved from product-centric to a customer centric positions. Satisfaction has become of great

interest to experts because it is important to customer retention (Patterson et al., 1997; Sedon,

1997). The Development Finance Corporation is Belize’s only Development Bank. The

corporation’s main purpose is to support the strengthening and expansion of Belize’s economy

by providing developmental financing on an economically sustainable and environmentally

acceptable basis to individuals, businesses and organizations. Currently, the Development bank

has branches in each district inclusive of a sub-branch in San Pedro Town. According to the

Corporations management, DFC offers professional development to employees and has invested

heavily in training staff so as to keep customers satisfied and meet their expectations.

However, there is argument that despite several initiatives taken by management to

increase customer satisfaction, there are still some customers that are not satisfied with the kind

of service being offered. These are discrepancies between perceived performance and

expectation from customers point of view (perceived performance is less than expectation) that

makes them dissatisfied. Therefore, improved service quality in the future is the critical factor

that will determine whether the business will survive or fail (Thompson, Green &Bokma 2000).

Better service quality typically helps to get higher market share and better returns (Slu&Mou

2003). Taking into consideration the service quality parameters for improved service

performance, researchers have chosen to assess and uncover the applicability of DFC’s service

quality and customer satisfaction using the SERVQUAL model. This model measures the

difference between customers’ expectations and perceptions in terms of performance within the
DFC headquarters using various service quality dimensions including tangibility, reliability,

responsiveness, assurance and empathy. By striving at meeting or exceeding customer

expectations; the DFC will be able to increase market share and maintain a high service quality

within the banking industry.

Every financial institution needs to get an insight of its performance. More specifically it

includes on getting to know the impact of service quality with regards to customer expectations

and loyalty. If this is done then the financial institution would know how to provide a superior

value over competitors. Whether an organization provides quality services or not will depend on

the customers’ feedback on the satisfaction they get from consuming the products, since 2 higher

levels of quality lead to higher levels of customer satisfaction (Kotler & Keller. 2009, p. 169).

With the use of the SERVQUAL model we will get to know if DFC is providing proper

service quality to its customers and what is the link with customer loyalty. In addition, after

analysing we will get to know some possible improvements that The Development Finance

Corporation can adopt so as to have much more customers that before.