Service performed (Lehtinen & Lehtinen, 1982; Lewis

Service qualityDefinitions of service quality hold that this is the result of the comparison that customers make between their expectations about a service and their perception of the way the service has been performed (Lehtinen & Lehtinen, 1982; Lewis & Booms, 1983, Gronroos, 1984; Parasuraman et al., 1985; 1988; Caruana, 2002).Service quality refers to an overall impression of the judgement made by the customer concerning the service provided by a company (Hussain et al., 2015; Wang, 2010). Increased global competition has led to many ways in which organisations seek to maintain competitive advantage.

One of the strategies is to deliver high-quality service unmatched by competitors (Hu et al., 2009; Hussain et al., 2015; Kim, 2011; Wu et al., 2015; Zameer et al.

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, 2015). Service quality has been defined by the practitioners in terms of key dimensions that customers use while evaluating the services (Lewis and Booms, 1983). The service quality literature has also highlighted that service quality can also be treated as a second order construct consisting of interaction, physical environment and outcome quality (Brady and Cronin, 2001).Customer SatisfactionCustomer satisfaction refers to the state of a customer when the actual performance of a product meets its expected performance (Gustafsson et al., 2006).

Customer satisfaction is closely related and often confused with service quality. It represents an immediate response or emotional reaction to consumption (Hussain et al., 2015; Kim, 2011). As such, customer satisfaction can be described as an overall emotional response towards the customer’s experience after the purchase and consumption of a product/service (Eid, 2015). It is a customer’s feeling of pleasure or disappointment due to a comparison of the product’s perceived performance to expectations (Tarus and Rabach, 2013). Satisfaction is closely related to service quality (Jabnoun and Khalifa, 2005), which is of importance in the financial services industry, as customers primarily buy promises that their funds and welfare will be looked after in the best possible manner, and their perception about the fulfillment of these promises leads to long-term association between customer and financial services provider (Harrison, 2003). Regarding the banking sector, Ladhari et al. (2011) defined customer satisfaction as the total evaluation of the overall level of services provided.

It is thought that satisfaction is likely to increase customer loyalty (Vesel and Zabkar, 2009; Akhter et al., 2011) and according to the service?profit chain and other studies, it is suggested that satisfied customers result in better financial performance (Bernhardt et al., 2000; Chi and Gursoy, 2009; Fathollahzadeh et al., 2011). The literature documents customer satisfaction as the most dominant indicator of CL (Hoq and Amin, 2009).

A satisfied customer’s opinion of a service provider can stimulate him or her to make repeat purchases from the same service provider and even suggest this service provider to other clients as well (Lam et al., 2004). Customer satisfaction, CL, and SQ are the most important factors for successful business environments, especially for service providers (Zeithaml et al., 1996). The literature constantly supports that customer satisfaction is a key indicator of CL in the service industry (Eshghi et al., 2007).

Ehigie (2006) suggests that there is a significant positive relationship between customer satisfaction and customer loyalty/retention. As such, customer satisfaction in this research is acting as a mediator between service quality and customer loyalty.Customer LoyaltyConsumer loyalty is in essence, a customer’s faithfulness to a particular service or brand (Amin, 2016; Gorondutse et al., 2014) and the connection which a customer has with a brand. Customers maintain a series of loyalties to the organisations and their level of faithfulness with companies also determines their purchasing behaviour.Loyalty can be measured with both attitudinal and behavioural items (Jacoby and Kyner, 1973; Dick and Basu, 1994; Fathollahzadeh et al., 2011; Akhter et al.

, 2011). Attitudinal measurements, due to the fact that they reflect the psychological and emotional attachment to loyalty, are used in order to understand the cognitive elements that underlie purchasing motives and future actions (Bowen and Chen, 2001; Fathollahzadeh et al., 2011). They are viewed to add some degree of value to the product or service (Wu, 2011a). Behavioural measurements, on the other hand, focus on the customer’s purchasing history (Vesel and Zabkar, 2009; Fathollahzadeh et al., 2011) and have been measured by the repetitive purchasing behaviour that a customer shows towards a product or service (Wu, 2011a). Loyal customers are very important for the survival of any business (Ganguli and Roy, 2011) due to their relationship with the company’s market share and profitability (Tsoukatos and Rand, 2006).

Customer loyalty is becoming more important in financial sectors especially after deregulations have given customers more flexibility to choose their financial services (Levesque and McDougall, 1996).Loyalty regarding the banking sector is defined as the customer’s repeated patronage of a certain bank over a long period of time (Ladhari et al., 2011).

Loyal customers are characterised by repetitive purchasing of products and services, recommending the company to others, defending it against bad comments by strongly supporting their choices (Akhter et al., 2011).Relationship between Service quality and Customer LoyaltyThe financial services industry is changing rapidly in the UAE due to technology, governmental deregulation, and the increasing sophistication of customer needs.

Service quality has become a very important topic within the banking industry across the globe. Banks that offer a distinguished level of service have a competitive edge. Many researchers have demonstrated a valid and strong link between higher quality service and desired marketing outcomes, such as higher revenue, customer satisfaction, and loyalty (Abdullah et al.

, 2011; Al-hawari et al., 2009).SQ has remained central to product value since the inception of the term. Today, customers demand high-quality products and services, which make it imperative for industries to enhance the quality measures manifested in various facets of products (Zineldin, 2006).

Studies on customer satisfaction and the loyalty of banking customers have acknowledged that satisfaction, market situation, service reliability, responsiveness, and tangibility determine satisfaction, which affect loyalty and willingness to pay more for services (Pont and McQuilken, 2005). Zineldin (2006) argued that SQ significantly influences CL in most service-based organizations.Sufficient evidence is available to embark on an exploration of the role of SQ in predicting CL (Bloemer et al.

, 1999). Confirming other studies, Lewis and Soureli (2006) also reported the positive impact of SQ on CL in the banking industry. Lin and Sun (2009) reconfirmed the same findings in an online banking context.

Choudhury (2013) indicated that the higher the level of services quality the companies might offer the more favorable customers behavioral intentions can be achieved. The positive behavioral intentions include saying positive thing about the company to others, recommending the company to others, encouraging others to do business with the company, doing more business with the company, and considering the company the first choice. The relationship between perceived service quality and customer loyalty has been theoretically and empirically confirmed in the literature on the services industry, including banks (Al-hawari et al., 2009).


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