The effect of service quality on customer satisfaction of Bank Islam Malaysia Berhad

Customer satisfaction is a pivotal element in the banking industry, particularly in Islamic banking, where unique challenges arise in meeting customer expectations. This study aims to determine the effect of service quality dimensions reliability, responsiveness, assurance, empathy, and tangibles on customer satisfaction at Bank Islam Malaysia Berhad (BIMB) in Northern Malaysia. Using a quantitative research approach, data were collected from 300 respondents through structured questionnaires utilizing Likert scale and analyzed using Partial Least Squares Structural Equation Modeling (PLS-SEM) and using simple random sampling. The findings reveal that assurance, empathy, and tangibles have significant positive impacts on customer satisfaction. Assurance emerged as the most influential factor, highlighting the importance of knowledgeable and trustworthy staff in building customer trust. Empathy and tangibles elements also demonstrated substantial effects, emphasizing the need for personalized care and modern facilities to enhance satisfaction. Conversely, reliability and responsiveness did not show significant correlations with customer satisfaction. This research contributes valuable insights into the dynamics of service quality within Malaysia’s Islamic banking sector. It underscores the necessity for BIMB to focus on assurance, empathy, and tangibles aspects to improve customer satisfaction significantly. Moreover, it highlights the importance of integrating ethical standards with modern technology to maintain customer trust. The study provides actionable recommendations for BIMB to enhance its services and suggests that policymakers support initiatives blending traditional values with technological advancements to foster sustainable banking practices