The Impact of Service Quality of Automatic Teller Machines (ATM’s) on Customer Satisfaction

Abstract

The major purpose of this study is to identify the main dimensions of service quality using PARASURAMAN model that have a direct impact on customer satisfaction in banking sector. I have explained different models of service quality, which I have observed and perceived. Multiple dimensions are taken in this research in order to measure service quality. These dimensions may include tangibles, reliability, responsiveness, empathy, assurance and security.

The thesis is basically divided into five chapters Data was collected through questionnaires with a sample size of 150. SPSS 21 is used for statistical test for demographic, reliability, correlation, normality and regression analysis.This research basically uses SERVQUAL model.

As the main purpose of thesis report is to learn by working and to have a lot of research so that we can apply the knowledge to improve the service quality of ATM machines.

CHAPTER 1

Introduction

1.1  Background of the Study:

Service quality is basically considered as the most prominent topic for researchers. Service quality plays an important role in gaining competitive advantage. “Service quality” is used to judge the attitude of the customers related to the superiority of the service. Service quality is also defined as “it is the overall valuation of superiority of the provision of services through electronic usage”. On the other hand “customer satisfaction” is basically related with definite transactions. Additionally numerous researchers have investigated the relationship between service quality and consumer satisfaction. And then this will become a topic of great interest. (Zeithaml, 1996)

There is no single definition which portrays the bank altogether and totally. Each expert and researcher characterizes word “Bank” in his/her own particular style or way. After that there are critical definitions which can helps to comprehend a word “Bank”. So it is indicated as “Bank manages obligations of its own and others. Bank obtains cash from overall population and advances credits to poor individuals.”  Furthermore “Bank is a foundation which manages cash. It gets from the general population who has cash in abundance and propels credits to the general population who need to put into some business.” Another expert stated as Investor is such individual or the organization which performs taking after exercises:

• Opens the records
• Make installments against client’s checks
• Receives measures of its client’s checks from different banks

From above definitions, it is concluded that the bank is a substance which manages CASH. Individuals store their investments into banks and take it out from the bank when they need it.

Banking sector is considered to be the significant part as it plays a vital role in financial development and improvement in any economy. But considering this point of view, this problem is at a great extent missing in Pakistan. Banks all in all have done well as in industry yet they are a long way from an essential part of a financial development system which guarantees more prominent accessibility of and access to credit. This can be clearly comprehended that the banking sector of Pakistan is being developed and may be in improvement phase. General monetary conditions in the nation are described by low development, high bulge, extensive financial shortage, declining venture, expanding responsibility level, unstable security condition, poor peace, political instability, developing energy emergency are likewise weighing negatively impact on the development prospects. (rizwan, 2012)

1.1.1 Banking in Pakistan:

In Pakistan, banking sector has all around created framework. Research was conducted on the effect of banking sector with respect to economic growth. In this day and age Banks assume a notable part in every economy and reflect as financial institutions. So in generally it receives deposits at lower rates and loan to another at higher rates. The gap between these rates is known as the benefit which is too called the “bank spread”. In Pakistan banks are the main institution and saving money part is developing quickly from the most recent two decades.(Syed Muhammad Hamza, 2014)

• 1.1.2 ATM Machines:

In Pakistan the first automated teller machine service was introduced by Habib Bank Limited. And it provides the facility to customers to have transactions within seconds. Now a days it is the important service which had made our life easier. For many organizations that can easily have installed and maintained, automatic teller machines (ATMs) put in all around nearby areas, which have been showed to offer a few business benefits.

Service quality basically exists in each stage or development of life and various parts of administration interrelated with human sense and society. So service quality also plays a significant role in the banking sector of Pakistan. The idea of administration at present utilized and existed as a part of history of people. The best idea has considered this perspective that the learning of administration relates with quality and specialized measurements in efficient way. The observation and desires of client about administration will decide the administration quality. When the administration does not fulfill the customer satisfaction then it may look as that the administration is just below the principles. Considering the other side when consumer satisfaction is as per the desires and expectations of the consumers then the perceived customer satisfaction must be high. Banks regularly require increasing and developing clients. (Naeem Akhtar, 2016)

1.2 Objective of Study:

The major purpose of conducting this study is to observe those factors of service quality of ATM machines which are increasing customer satisfaction. Additionally to find out how we can easily achieve customer satisfaction. These findings of the study will be very beneficial to the various banks in Pakistan. It will also help the ATM part to identify their ATMs positive and negative features as well as customers.

Furthermore the study also helps us to find out the service quality of ATM machines using PARASURAMAN model. The model includes various dimensions, and the dimensions which are used in this research are“tangibles”, “reliability”, “responsiveness” ,“ assurance”, “security” and “empathy” and “customer satisfaction”.

The research work was undertaken specifically to evaluate various things:

• To evaluate the level of service quality and consumer satisfaction for ATM machines in the banking sector of Pakistan and recommend various ways of improving service quality of ATM machines.
• Which element of service quality highly influences on customer satisfaction.
• Evaluate the quality and behavior of staff in banking sector of Pakistan.

As stated above, that the research includes the elements of ATM service quality and their impact on customer satisfaction. So these elements might have a direct impact on overall performance of ATM service which includes extra charges which are imposed on using ATM service, availability of complaint book, sufficient number of ATM machines at per station, cash withdrawals, availability of backup generator, security issues and proper delivery of ATM cards.

1.3 Scope of ATM machines:

The ATM is regularly observed as a different area of banking sector of Pakistan. It is an innovative machine that totally works independently. For many customers, the observation is that the automated teller machine hasn’t changed since its origin in the 1960s. Over the coming years what we find in this channel will impact, and be affected by, different changes to innovation moves in the technology in banking sector.

Maybe the greatest change that has effectively occurred is that the ATM cards have been increases to 26 million in Pakistan. And ATM cards have been issued by different banks. (Rahman, 2014) Customers can pay charges, buy occasion tickets and pay in checks at ATMs nowadays. This alone keeps on highlighting the key part that the ATM and trade will have out what’s to come. The ATM frames a key channel for customers to get hold of money. Furthermore, the ATM is additionally an amazing approach to keep up client engagement on all day without any problem.

• 1.3.1 Growth of ATM machines:

As number of customers start using mobile banking and online banking so some of them have suggested multiple branches and ATM service will no longer be used by the customers. On the other side the situation is totally reversed to that what we are seeing. So with the improved technology and amazing functionality of ATM machines is more helpful and useful to customers. Asian region driving growth of new technology and new ATM machines and the modern technology of ATM machines is rising so rapidly. This is just in response to changing customer behavior, replacement of multiple machines in banking sector of Pakistan. This may be the sign of financial growth.

A style or trend that is emerged out in the last few years ‘is contactless technology. This may allow customers to swipe their card to initiate their transaction. Many people used to think that ATM is nothing but ANY TIME MONEY. Now a day everybody is totally aware of the ATM benefits and uses. But the technical definition of ATM machines may be defined as “it is the machine which facilitates customers with basic banking services, withdrawal of money, depositing money and etc”. ATM is performing most of the functions than a cashier in the bank. We all know that ATM performs its function through plastic card which is basically issued by bank and is called ATM card. This plastic ATM card is replacing the cheques, attendance of customers, banking hours, holiday’s restriction and many others.

• 1.3.2 Major benefits of ATM machines:

• ATM machines provide round the clock services to its customers. The facility is available 24 hour a day, 7 days a week or a year.
• Customers can easily access to bank from any corner of the world. It may include some essential components like deposits, withdrawal transfer of funds etc.
• Banking sector of Pakistan is spreading out its services to all corners of the world. This can be done through by providing electronic access to customers.
• ATM machines also help in reduction in cost of operation. This reduces human involvement and also increases the profitability of banks.
• Customers just need a bank account to have a debit card, which is the ATM card. On the other hand it is simply linked to the bank account.
• Account balance inquiry can be handled by ATM card. And customers are facilitated by mini statement of the bank account.
• Customers can easily get the details of recent transactions and can quickly get the bank statement. The information might be brief to the last 8 to 10 transactions.
• With the help of ATM card there is no need to go to the branch to deposit cash etc. Just go the nearest ATM machine it will help you for quick transactions.
• It will also help to reduce the work load of the bank staff.
• ATM is very helpful for travelers as they need not to carry cash with them all the time. They can easily withdraw cash in any city through ATM machine facility.
• ATM also provides highest privacy in banking transactions.

Furthermore usage of ATM machines in Pakistan and India is growing very fast. As the survey conducted in 2002, it was found that the density of population is using ATM service. For the recent years it is concluded that most customers who requested for a cheque book and most of the time bank managers told them to use the facility of ATM card.

The major benefit of using ATM machine is convenience. It is not needed to visit the bank on daily basis. This will help to avoid long teller lines in banks. Furthermore cash can easily be withdrawn. Additionally this facility will also help to get cash instead of swiping the debit card. It will provide the customers with a statement instead of a bunch of receipts. And finally the process of using an ATM card is very simple. Customers just have to insert the card in the machine and just enter the pin or password. After the completion of transaction, the card is ejected from the ATM machine and the cash will be easily withdrawn.

1.4 Significance of the study:

The research study of ATM machines helps to provide the best guidelines to managers of different banks to facilitate the number of customers with service quality. It is just because the efficiency of multiple banks totally relies on customer satisfaction. The major aim of every bank is to achieve maximum market share as compared to other multiple banks. This research also helps to understand that how the ATM service will be improved much more while checking the impact of all dimensions with respect to the customer expectations.

Different banks can satisfy their customers by providing reliability of account accuracy. The methodology of using ATM machine should be simple as compared to competitors. Furthermore findings of the study help the managers to remove weak points of ATM machines. Finally it also helps to fight with multiple problems of bank with regards to the level of customer satisfaction. This research basically recognizes the major quality elements to Pakistani Banks. So, that the banks develop outstanding strategies and progress in the service quality of ATM machines. It will help to improve the competitive position of a bank with respect to other banks, especially in the period of strong competition. This research will provide a proper guidance for Pakistani Banks to develop best policies that will improve overall service quality.

1.5 Problem Statement:

The basic purpose behind the study is to have an investigation of service quality of Automatic Teller Machines (ATM’s) on customer satisfaction in banking sector of Pakistan. This investigation incorporates some dimensions which include tangibles, reliability, responsiveness, assurance, empathy and security. So the research has to find out the highest and least impact of major dimensions on customer satisfaction. The adequacy in automatic teller machines and its service quality has a direct impact on customer expectations. It might include multiple problems like delivery of complaint book, errors in withdrawals, reaction of security guard; numbers of ATM machines are less as compared to the number of customers.  Usually, the banking system is established in urban areas so the customers of rural areas are facing problems in service. Errors may occur in cash withdrawals due to some technical and other transaction problems or in case of wrong pin code ATM card cannot be recovered after three attempts .Furthermore the attitude of security guards with customers is totally unethical. So the customers do not feel safe during transaction.

1.6 Respondents of study:

We have gathered different responses from employees, students, customers who are currently using ATM services.

1.7 Structure of this study:

The remaining part of the paper is categorized in the following sections: Section I is all about introduction, in which scope, significance and major benefits of the study are discussed. Section II focuses on the review of literature. Research methodology is discussed in section III. While section IV states the results and findings and finally section V states the conclusions and recommendations of our research.

CHAPTER 2

 

Literature Review

2.1 Overview:

The fundamental purpose behind the study conducted is to discover the effect of service quality on consumer satisfaction concerning Automated Teller Machines in banking sector of Pakistan.Customer satisfaction basically depends on three dimensions which include performance, perceived quality and reliability. The research was conducted in Singapore whose major aim is to find out the impact of reliability, responsiveness, tangibles, empathy on customer satisfaction. The researcher easily find out that these elements of service quality like “tangibles, responsiveness, reliability, assurance, empathy” have positive relationship with customer satisfaction. (J.T. Akinmayowa, 2014)

According to the previous research, we can find out that service quality of Automated teller machines in banking sector plays a critical role with respect to customer satisfaction. Considering the impact of service quality, in order to achieve competitive advantage and to improve service quality to attract customer’s number of banks we used to promote the use of Automated teller machines (ATM). Taking into consideration, the research of Castleberry the location of the bank and all other physical factors majorly influence the true perception of customers about quality. Furthermore he added that the bank should provide all consistent services, other physical dimensions and proper staff interaction can have positive effect on service quality. (J.T. Akinmayowa, 2014)

Literature related to service quality in the banking industry reflects a significant role in customer satisfaction. PARASURAMAN developed service quality instrument in order to access service quality. There are many other scales to examine service quality such as SERVQUAL or ES-QUAL and E-Res-QUAL. Furthermore study is conducted on customer satisfaction and the researchers investigate that there is a significant role of customer satisfaction in banking sector. Because customers are the sources of income for banks and customer satisfaction is very important for maintaining your existing customers. (Haroon Rasheed, 2012)

2.1.1 Definitions of Service

According to Jobber, “service as any deed, performance or effort carried out for the customer”.

According to Palmer, “Services are products which are essentially intangible and cannot be owned”.

2.1.2 Service Quality:

Service quality can be defined as “the relationship made by the customers related to their expectations and the perception of service that are performed”. Furthermore service quality incorporates quality which meets customer satisfaction and also relates which exceeds or fails to meet customer satisfaction. According to PARASURAMAN and BERRY, “service quality is the degree and the way of difference between the customer’s observation and expectation to which a service meets customer expectations.  On the other hand service quality is the measure of how well is the service level and it matches with customer satisfaction.”(Adeleye Idowu Olusanya, 2015)

In some researches, service quality is totally differently defined. Another definition of service states that, “the intangible activity which provides satisfaction to customers and not related with the sale of any product or any other service.” However service quality is considered to be the most significant factor in any sector. Perceived service quality is another determinant of customer satisfaction. It is observed that service quality plays a very important role in banking services. It has usually placed a high value on customer relationship in banks. (Al-Azzam, 2015)

Service quality is basically the customer overall sense of the comparative weakness and strengths of multiple organizations and its services. Nitecki and Hernon (2000) defined the service quality as the level should meet or exceed the customer satisfaction or we can also consider the customer perception and customer expectations. Furthermore another definition of service quality is the consequences of the evaluation process in which they can easily measure the perception of service outcome. (Chi Anh Phan, 2015)

Service quality of ATM machines can also be defined as, “The gap between the customer potential for the services meeting standards and the perception of services received by the customers.” Considering the service quality theory that customers will evaluate the quality of the services provided in banking sector as low if the performance doesn’t meet their expectations. If this gap needs to be closed, the organization should match the customer expectations or highlight the customer perception of what has been received by the customers. (Jayaraman Munusamy, 2010)

Three components of service quality are as follows:

• Perceived service
• Expected service
• Image

2.1.3 Customer satisfaction:

“Customer Satisfaction is the degree at which the product or services reach the standard of the buyer in his or her expectations. It deals with what people called as surprise quotient. This is to extend at which firms give out unexpected technical characteristics or personal service to a customer”.

Research conducted on the concept of customer satisfaction, states that it is the difference between prior services the customer is using and the perception of multiple customers. At one point it is also defined as an experience which is totally superior to customer expectations. (Adeleye Idowu Olusanya, 2015).

Another research conducted on customer satisfaction is basically the judgment of service provides a pleasurable level of fulfillment. Another definition of customer satisfaction states that, “the evaluation by customers related to the service they have received should be too good as they are perceived by the customers.” Customer satisfaction is considers to be the most important factor as it reflects the customer evaluation.

According to Santos (2003) the quality of automated services is the most significant factor in banking sector and has a great importance for customers. As it has the influence on attractiveness, profitability, maximum competitive advantage and customer satisfaction.

2.2 Service quality of Automated teller machines (ATM):

The major advantages of using ATM create a new impetus in dimensions of service quality and customer satisfaction. The most important thing is that an amazing ATM service resulted in fast speed of transactions and also helps to save time. Certainly, research indicates different dimensions of ATM service quality. Some essential dimensions of service quality include user friendly system, proper functionality and convenient location. Another major factor is the cost involved in the use of automated teller machines. (J.T. Akinmayowa, 2014)

Additionally service quality of automated teller machines basically defines the overall evaluation of customers. This evaluation may include the provision of services through internet, ATM and may be mobile banking. (D.Venkatesan, 2014). The research found that automated teller machine is considered to be the superb facility as it is an amazing innovation that helps to deposit money, issue withdrawals collect bills and many other. This has totally changed the relationship between the banks and the depositors. Many other factors influence the customer satisfaction which incorporates user friendly system, secure location; adequate number of machines should be available at secure location, high speed during transaction process, backup facility should be available and the cost associated with ATM.  (Kumbhar, 2011)

Considering the case study of Botswana considered the speed of transaction through automated teller machines and the waiting in long queues is considered as the most important factors of ATM service quality. Researchers have different and multiple views about the use and efficiency of Automated Teller machines (ATM). STEMPER states the positive elements of ATM service quality. Effective and valuable usage service quality in ATM system ensures quality distinction and superiority performance and provide independence to the customers. YAVAS, BENKENSTEIN & STUHLDREIER (2004) states that customers’ used to focus on ATM service quality that usually fulfills the customer’s needs and maximize the operational performance. These are basically the essential dimensions of Automated Teller Machines (ATM) banking in order to achieve or sustain competitive advantage. AL HAWARI and Ward states five important items of service quality as they are stated earlier which may include sufficient number of ATM machines through which customer can easily make transactions without any wait. Other may incorporates as user friendly system, secure location and others. (J.T. Akinmayowa, 2014)

Considering the satisfaction and expectation level of ATM card holders of a bank in Bangladesh, observe the important link between customer satisfaction and service quality. The study recognized that location, employee’s response, excellence and excellence of currency notes, speed and swiftness of card delivery and performance of ATM were positively and significantly linked to customer’ satisfaction. The insecurity factor, normally go wrong or stop working and insufficient number of ATM machines were major factors of customer dissatisfaction. Another study conducted in Bangladesh, twenty four hour service of ATM machines, accurate slips of transactions and possible location were the essential factors of customer satisfaction. (J.T. Akinmayowa, 2014) There are some well-known standards which play an important role in the service improvement of automated teller machines. These standards may include Business Process Maturity Model. This methodology is basically complete and process oriented. The major idea behind this is to provide different solutions by setting up clear quality evaluation. Another study was undertaken in Malawi. The study was conducted for 353 automated teller machines. After the study the results shows that half of the customers are satisfied with ATM service and shows that reliability is considered to be the most important factor followed by responsiveness, empathy, tangibles and others. (Chi Anh Phan, 2015)

Numbers of scholars have done research on automated teller machines and they came to know that it is considered as a means to service quality from multiple dimensions. MOSES GOSELE (2015) identified safe and secure location. Functionality of automated teller machines should be superb in order to provide best quality service delivery. Furthermore a study conducted in Botswana (2004)found that high speed of operation and decrease in waiting time are the important predictors of ATM service quality. Successful and efficient service delivery in ATM system guarantees service quality provides better performance and also provides independence to the customers. ATMs operation totally depend on the maximum speed of ATM machine, minimum errors, high up-time, cash backup, readable slips and value-based aspects such as quality service at reasonable price and maximum offerings to cover maximum needs of customers as an important component. (Farouk, 2015).

Additionally other research found that customers are willing and ready to accept new offerings and changes in ATM machine. Sometimes customers have to face many problems like they have to wait in a queue for a long time to use the ATM service. This major issue causes dissatisfaction among the customers. Researchers like KALUSHA, REICHHIELD have examined that technology-based services are likely to give sense of ineffectiveness to customers. Sometimes ATM machine does not provide customers readable slip which also creates problem for the customers. They are unable to be aware of the balance and many other problems. (Farouk, 2015)

Service quality is considered to be the critical factor in respect to the organizational performance and it is also measured as a critical issue. A research was conducted on a link between the service quality and customer satisfaction and he investigated it theoretically in the banking sector. Service quality is considered to be the most significant requirement for maintaining a strong relationship with customers. (Ward, 2006)

Many researchers have used SEVQUAL model in previous studies to investigate bank services while other researchers have used smaller number of dimensions to investigate service quality.Another research states that bank service quality used 19 attributes and these are grouped into dimensions. (Manshor, 2009)

2.3 Customer Satisfaction with Automated Teller Machines (ATM’s):

For comparing the customer satisfaction and automated teller machines the most important things is to have the relationship of expectation and evaluation with respect to customers. (Helena R. Snee, 2008). Prior researchers have found that consistency and reliability feature of Automated teller machines is very essential for customers so that they can easily use electronic channels of banking sector. Many researcher studied different attributes of ATM service quality, customer satisfaction and marketing implication. So convenience, reliability and easy to use ATM machine are considered to be the important dimensions to check the service quality of ATM’s. (J.T. Akinmayowa, 2014)

PARASURAMAN model (Zeithaml, 1996) can be used to access service quality. This model incorporates different dimensions which incorporate tangibles, responsiveness, reliability, assurance, security, Empathy. Another study conducted in Canada recognized that major reasons for using automated teller machines were convenience, autonomy to do banking at most of the times and to avoid waiting process. Furthermore the users’ uneasiness and worry about the risk linked with its use and difficulty of the machine in executing transactions were the problems.

The relationship of the dimensions of the usage rate and performance expectation with respect to ATM services was also discussed in earlier studies. Some results indicated that the usage rate of ATM machines had a negative link with customer satisfaction whereas performance expectation found to have a positive correlation with customer satisfaction. Whereas accessibility also plays an important part in customer satisfaction with automated teller machines. According to ATHANASSOPOULOS (2000) stated that the location ATM machines, increasing number of ATM machines and expanded service are totally linked with the switching of banks. The better performance and efficiency of any organization will create number for customers to maximize profit. International researches have a major focus on customer satisfaction because if the customers are satisfied with the services provided by the firm then organizations will be able to achieve customer loyalty.  (Agbor, 2011) 

2.4 Link between service quality and customer satisfaction:

According to PARASUARAMAN there is a huge difference between service quality and customer satisfaction. Perceived service quality is the leading and superiority point of service quality. On the other side customer satisfaction totally relates with the transaction quality of automated teller machines. As numerous researchers have examined the relationship of service quality and customer satisfaction, so CRONIN (2001) investigated this relationship and states that perceived service quality totally depends on customer satisfaction. Other studies also conclude that service quality of automated teller machines is the predecessor of customer satisfaction. (Robertson 2001).

SURESCHANDAR (2002) used a specific approach to examine the relationship of service quality and customer satisfaction of multiple banks in India. The major factors used are responsiveness, tangibles, reliability, assurance and security. (Chi Anh Phan, 2015)

Automated teller machines (ATM’s) means avoid traveling with money. Because ATM’s are the most successful and amazing machine to provide customer an easy access to electronic money as well as transactions. This is the most convenient and simple way as compared to the banking halls and long hour’s transactions. With the provision ATM machine facility banks are able to successfully and efficiently serve customers outside the banking hall.  This is totally an uninterrupted procedure with respect to the time and period. LASSAR (2000) conducted a research on the improved productivity, enhanced customer attraction and best staff morale. The importance of service quality with respect to competitive advantage, sustainability and profitability, the banks are using multiple approaches to improve the service quality in banks. Some most important factors include consistent delivery services, physical dimensions, best staff interaction and trustworthiness. Lovely and pleasant customer interaction with staff affects the customer perception of quality. Banks have started flawless delivery processes that will help to improve the performance of ATM machines. With regard to adaptability of ATM machines, then we came to know that it has become very popular among customers. This innovation is adopted by customers due to huge investment. (Farouk, 2015)

On the other hand another research was conducted in Hong Kong. So, according to researchers empathy and assurance had the highest impact on customer satisfaction in Malaysian banking sector. Furthermore other researchers found that reliability had the highest influence on customer satisfaction. (Mei mei lau, 2013)

Service quality has been recommended as a most significant predictor of customer satisfaction by many researchers. Service quality is basically a drive of the customer satisfaction and it has a positive impact on it. It is also considered as a major factor for customer satisfaction. Additionally it is also considered as a most significant tool for bank in order to increase their income and market share. (Fasih, 2014)

2.5 Expected service and perceived service:

Perceived satisfaction is considered as a large concept in which customers can believe that the services they are using can satisfy them or not. In other words it is the customer perception and valuation of the service which has been used by the customers.  If the bank is not meeting service satisfaction then it is considered as “customer dissatisfaction”. It may be examined with the help of separate services and it may include a haircut experience, a dentist visit or an experience on an airline. But on the other hand when we are concluding the perceived satisfaction then it is an aggregate of all prior customer satisfaction.

Researchers found an empirical analysis for the distinction between expected service and perceived service. Perceived service is basically the valuation of the service received by the customers and the comparison with their expectations. Thus perceived service quality can be managed when employees can be treated in a right way. And expected service quality differs with respect to different cases. It means that what are the standards of service the customers are expecting.Furthermore another researcher recommended that service from a customer’s viewpoint may actually be a correlation made up of repeated, similar service encounters. Quality basically refers to the superiority or distinction. High standards of service quality have a great impact on consumer behavioral intention. (Jayaraman Munusamy, 2010)

Thus these encounters may be human as well as technological encounters in determining customer’s overall satisfaction. A research was done on the attribution theory which directly influences overall customer satisfaction. This theory says that people are coherent information processors whose actions have a direct impact by their fundamental conclusions. Previous researches have shown that customers look on the causes of service quality failure only when they experience service quality by themselves. Otherwise they do not look on the causes if they experience successful transaction. (Simmers, 2009)

2.6 Some malfunctioning of banking sector of Pakistan (ATM machines):

There are number of problems which a banking sector of Pakistan is facing. So according to a report published in Pakistan 2016, it is stated that there long queues of customers outside different banks and they have to wait for a long to have transaction from ATM machines. Customers usually give their bad feedback about the bank links in ATM machines. Sometimes they have to face nonfunctional or out of cash problem. Like sometimes customers had to use urgent ATM service, but the ATM machine is out of cash. This is the major problem faced by the customers. And this will have a direct impact on customer satisfaction. Furthermore in the recent years, most banks of Pakistan are closed for long Eid holidays.  (Report, 2016)

2.6.1 Online system usually slows down:

In the recent years we have seen that half ATM machines of every bank in Pakistan shut down when the online system usually slows down. Customers have to do transactions but due to this problem they try to get their money out of their account through checks. Taking in review the problem of pensioners they usually start lining up outside the banks of Pakistan in order to resolve their issue.

2.6.2 Incompetent staff and bad banking service:

Incompetent staff and bad banking service have greatest impact on customer satisfaction. Most customers are not satisfied with the employee behavior. Employees are not willing to help customers all the time or specially in the peak time.Thus numbers of customers are not satisfied properly. (Ali, 2009)

2.7 Multiple ways to measure service quality:

This literature review basically explains that service quality is measured by the differentiation between the customer expectations and potentials of service provider’s performance and the evaluation of the service they are currently using. Many researchers found that many models were available to measure service quality. PARASURAMAN suggested the SERVQUAL model (Zeithaml, 1996)and on the other side SERVPERF model is also there. (Bedman Narteh, 2013). Furthermore research was conducted in Indian banks in 2004, and it was found hat best technology is used in order to provide better service quality to customers in terms of products, greater speed and convenient online transactions with high level of security planning. Banks have successfully adopted best automatic teller machines as a basic enabler for their business. This incorporates a diversity of networks, operations and all banking applications. Automatic teller machines help to facilitate the banks to offer round the clock services by using small human resources. In 2004 another study says that this outstanding technology used in Indian banks helps to have a prominent increase in productivity gains. (Lakshmi Kumar D. Malathy L.S. Ganesh, 2011)

SERVQUAL model is commonly used and applied in various services and it is used in various industries. These industries may include health care centers, large retail chains, banking sectors, restaurants etc. According to SERVQUAL measuring tool, “The model remains as the most complete attempt to conceptualize and measure service quality”. There are numerous benefits of using SEVQUAL tool and it also allows for examining numerous industries. (Munusamy & Mun, 2010)

2.8 Different models for service quality

A study conducted by JAYA SANGEETHA in 2011 is about the review of service quality models. The models are defined in the light of changed business scenarios.

2.8.1 Technical and functional quality model:

The major aim of any firm is to earn profit and to compete successfully. And in order to compete with others a firm must have an understanding of consumer awareness of the quality and in this way service quality is influenced. JAYA conducted a research that firm has to attain its service quality and perceived service in order to attain customer satisfaction. The researcher recognized three elements of service quality which include technical, functional and image. (Mahalingam, 2011)

Technical quality:

Technical quality may be defined as, “what the customer is receiving from the service”. It is defined as the quality through which customers are taking benefits as a result of his/her relationship with banking sector. It is considered to be very important as well as to evaluate the quality of service. It will be also explained as what will the customer actually get? It includes overall machine performance, amazing systems, ability to solve problem.

(Mahalingam, 2011)

Functional quality:

Functional quality may be defined as the technical results or outcomes. This is very important in order to find out the views of service the customer has received. Many researchers found that functional quality is much important than technical quality. And it is explained as how the service is presented to customers. It includes appearance of the customers and atmosphere.

Image:

Image is also very important for banking sector and mainly it is very difficult to build up mainly through technical factors and functional factors. It is considered as the kind of interruption of functional and technical quality. (Mahalingam, 2011)

2.8.2 Service quality model (Suresh Chander):

Furthermore another model is presented in a research conducted by JAYA and the service quality model is explained in a broad way. It specially deals with the major elements of human interactions and interventions in the service delivery by the banks. The instrument has some major factors like service product, systematization and standardization. The researcher has identified five major factors of service quality which include 41 items from customer point of view. These factors include: (Mahalingam, 2011)

• Service product – the major content of a service
• Human element in service quality like reliability, empathy, responsiveness etc
• Systematization – the process and procedures in technology
• Tangibles – including physical equipment, physical appearance of employees and is commonly known as “services cape”.
• The behavior of the employees or service provider

2.8.3 SYSTRA – service quality model:

Another model of service quality named as SYSTRA. Four dimensions for this model are as under:

• Service system quality:

This dimension is the most important and significant factor among all other dimensions. It is used to evaluate the service quality that can be clearly recognized by the system. It also considers the combination of multiple items which are related to the technical and functional performances. The functional quality includes listening to the customer’s needs and requirements, ease of availability, speed or response time. Whereas technical quality includes flexibility and customized service solutions, employee empowerment and update all the needs of customers.

• Behavioral service quality:

Behavioral service quality is used to evaluate the services which are performed by the employees. It is the combination of functional and behavioral attributes which includes politeness, friendliness and courtesy. It also includes service attitude of employees.

• Accurate service transactions:

The major focus on accurate service quality is the employees and system accuracy. It is the result of the customers, your own experience with frequency of errors in transactions and multiple mistakes when performing services for customers. This dimension is basically used to measure the accurate transaction. (Mahalingam, 2011)

• Service quality of machines:

This dimension focuses on quality of machine and equipment. It is also related to the reliability of equipment’s as well as their performance. (Mahalingam, 2011). Furthermore a study conducted in 2016, and the researcher explained the importance of service quality and the relationship between the service quality and customer satisfaction. Thus there is a huge difference in service quality and customer satisfaction. (R. Sruthi, 2016)

2.9 Human and technological problems:

A triangular model of service is presented includes company, employees and customers. Furthermore PARASURAMAN extended this triangular model by including another dimension which includes technology. And it reflects the dynamic connection between the employees, customers and technology in determining the success of service quality of ATM machines.

The perfect satisfaction is the one which customer basically obtains from the interaction and friendly behavior with employees in the banking sector. This is considered to be human encounter satisfaction. This plays an important part in overall satisfaction of customers. Sometimes customers had to experience front employees that are not even positive. With the increase of technology, service delivery has flourished. Nevertheless human failures can be considered more complicated and unclear as the services do not meet expectation. Furthermore customers will be much dissatisfied when they face a failure in transaction which basically involves human encounter in which they usually put all the responsibility on employees. Similarly if the customers are not facing any human failures then they can have a successful transaction. As a result human failures are considered more significant as compared to the technological problems. (Simmers, 2009)

2.10 Influence of reliability and responsiveness on customer satisfaction:

Another research was conducted in Singapore, and they have examined the dimensions such as reliability, assurance, responsiveness, tangibles and empathy in a broad way. The researcher found that these major dimensions of PARASURAMAN model n(Zeithaml, 1996) have a positive relationship with customer satisfaction. CHESEREK (2015) stated that there is a noteworthy effect of service quality on customer satisfaction. This area of study is done in Netherlands and data is collected through questionnaire.

The research was conducted in Pakistan totally relates with automated teller machines service quality and customer satisfaction in Pakistan banking sector. And multiple dimensions are discussed such as price, reliability, responsiveness, convenience, security and customer satisfaction. These all dimensions are related to ATM service quality and all these dimensions have a positive relationship with Service Quality and service quality have a positive relationship with customer satisfaction. (Naeem Akhtar A. R., 2016)Reliability is the significant dimension and it refers to the ability that provides expected standard all the time. It can also be defined as how the organization is able to handle all the service related problems of customers. Organization must provide its best services to customers within the promised time period. Customers must be satisfied with the services. (Iberahim, 2015)

Additionally the study was conducted in Kenya related to the commercial banks checks the reliability and responsiveness of service quality on customer satisfaction. Furthermore another research was conducted in 2010 in the banking sector of Malaysia related to service quality. So responsiveness of employees plays a vital role on customer satisfaction. Some researches define responsiveness as high speed, timeliness related to service delivery of ATM machines. This may also include the friendly behavior of employees and how they respond to the customers. Responsiveness also relates with the fast processing system of automated teller machines and high service abilities to respond speedily to customer’s requests and wait for a short period for transaction. Furthermore many researchers define responsiveness more specifically as willingness and eagerness of employees to provide best services. Responsiveness also relates with the understanding of need and requirements of customers. Sometimes customers also want special and individual attention to the problems related to them KUMAR (2009). Thus it is also the part of the responsiveness dimension. (Al-Azzam, 2015). Furthermore responsiveness is stated as the ability to respond to customer requirements at a proper time. Flexibility should be involved in it. Banking sector should have to adopt modern technology in order to deliver their services properly. (Iberahim, 2015)

2.11 Impact of security on customer satisfaction:

The major of any organization is to achieve maximum profit by providing better service quality to customers.  So it is also the most important dimension related to ATM machines. It basically refers to safe and secure environment which a customer may need for transactions. A research conducted in Arab banks reflects that there is a proper policy system related to the security issues in Banks. Guard should be appointed outside the ATM stations. Customers are satisfied with the security dimension when the service of automated teller machines becomes safe and secure and the customer’s information also gets protected. (Al-Azzam, 2015)

2.12 Impact of tangibles on customer satisfaction:

Tangibles are also considered to be the most significant dimension of service quality. Tangibles basically involve the banks representatives, physical facilities and all physical equipment’s. Physical environmental conditions are much important as it ensures the customer satisfaction. Additionally it is appeared as a clear and obvious proof of the attention paid by the service provider. DAVIS (2003) summarized tangibles as the physical confirmation of services provided to customers. Particularly PARASURAMAN defines tangibility as the appearance of physical equipment’s, employees and written materials. But in another research tangibles are the facilities that are provided to customers for the sake of their satisfaction. (Al-Azzam, 2015)

As service quality plays a significant role in any business sector. So for the growth and profitability of any banking sector, excellent service quality must be perceived by the customers. (Khan & Fasih, 2014)

HABIB BANK in Pakistan has invested great amount, and in return they have high profit gains. Furthermore MCB in Pakistan is also delivering great services of ATM machines and the customers are fully satisfied with the bank.

The word tangibles can be explained as “The things which are physical material and it can be touched easily.” So tangibles can be referred as the physical equipment’s in banking sector like ATM machines and its physical appearance. It can also include air conditioning system, security cameras and lightening. So service quality also depends on the usability of these tangibles. (Khan & Fasih, 2014)

2.13 Impact of Empathy on customer satisfaction:

PARASURAMAN has cleared the dimension Empathy in a broad way. He defined it as a caring and gentleness which is provided by the employees and the staff of the organization in order to achieve customer satisfaction. It also means that the individual attention is provided to the customers by understanding their needs and requirements. Employees should be so gentle, so that they can easily provide them facilities during peak hours. Furthermore another research conducted in 2001 demonstrates empathy in private banking sector. (Thatcher & Oliver, 2001) There is a friendly environment between the employees and the customers; they provide them personal attention, easy operation time and understand the needs of customers. Empathy basically involves sensitivity and efforts to understand the needs of customers. Al AZAM (2015) conducted a vast research on Empathy and defines that the employees of the organization should have the ability to understand the needs as well as make customers feel welcome.

It is concluded that there is a positive relationship between empathy and customer satisfaction. In another research study, researcher has concluded that if there will be a great gap in empathy dimension then customers remain unsatisfied with the service quality in banking sector of Pakistan. (Khan & Fasih, 2014)

2.14 Impact of Assurance on customer satisfaction:

Considering the other dimensions such as tangibles, reliability, responsiveness and security assurance is another dimension which plays an essential role in customer satisfaction. All of these dimensions are used to improve or boost up the customer satisfaction. It is assumed that the employees or the staff of banking sector shows the trustworthy behavior, the satisfaction level of customers can be increased notably. (Khan & Fasih, 2014)

In the above literature we have discussed some major dimensions of PARASURAMAN model (Zeithaml, 1996). These dimensions may include reliability, responsiveness, tangibles, security, assurance, empathy and customer satisfactions. in this research these dimensions are discussed in an appropriate way.

2.15 The Research Variables:

There is one independent variable in this research which is service quality and that measures the customer satisfaction. Furthermore service quality includes multiple dimensions such as tangibles, responsiveness, reliability, assurance, security and customer satisfaction. PARASUARAMAN SERVQUAL model is used in this research. Furthermore customer satisfaction is used as a dependent variable in this research.

2.16 Hypothesis:

H1: There is a significant impact of tangibles on customer satisfaction.

Ho: There is no significant impact of tangibles on customer satisfaction.

H2: There is a significant impact of reliability on customer satisfaction.

Ho: There is no significant impact of reliability on customer satisfaction.

H3: There is a significant impact of responsiveness on customer satisfaction.

Ho: There is no significant impact of responsiveness on customer satisfaction.

H4: There is a significant impact of assurance on customer satisfaction.

Ho: There is no significant impact of assurance on customer satisfaction.

H5: There is a significant impact of empathy on customer satisfaction.

Ho: There is no significant impact of empathy on customer satisfaction.

H6: There is a significant impact of security on customer satisfaction.

Ho: There is no significant impact of security on customer satisfaction.

2.17 Framework of Study

CHAPTER 3

Research Methodology

3.1 Overview of Research:

The third chapter represents the methodology used to conduct the study. Different research methods are discussed in this chapter. Also it highlights which sources are used to collect the data and what procedure is applied to analyze the data for research.

This study is based on the Automatic Teller Machine (ATM’s) service quality and customer satisfaction in banking sector of Pakistan. This research relates to the service quality of every bank in Pakistan with respect to the ATM’s, as it is discussed above that customer satisfaction totally depends on service quality. As there is larger population of male and female who are using ATM service. ATM is considered to be the most powerful and rapid source to withdraw money from the account. Furthermore the major aim of this study is to determine the dimensions of service quality which are stated above and to understand about the importance of these dimensions.

3.1.1 Qualitative Research:

Qualitative research is defined as, “a simple way of thinking about conducting research.” The data is collected in qualitative research through interviews, observations and multiple meetings (group discussions) are arranged. Qualitative research is used to observe why and how of decision making. It is not just related with where, what, when or who. It is used to have an understanding of reasons, attitude judgment and motivation. Unstructured techniques are used in this method. In this research sample size is not too large.

3.1.2 Quantitative Research:

Quantitative research is a measurement technique through which statistical and numerical analysis is done. In this research data is collected through questionnaires and surveys. It is also used to examine attitude, behavior and other variables. Generally large sample size is used in quantitative research. Structured techniques are used in this type of research. This type of research is related with how much, how many, how often.

3.2 Research Design:

“A research design is the arrangement for collection and analysis of data in manner that occurs to combine relevancy to the research purpose with economy and procedure”. Quantitative approach is used in this research for data collection and data is gathered through questionnaire by conducting survey. Thus the current research is conducted for overall banks in Pakistan. So this was done by adopting quantitative technique.

Additionally in this study population was 150, and this population was taken in account. And ATM card users were taken as sample. Data was collected in samples of Pakistan.

3.3 Sample size:

The research was conducted on students, employed people and others who are using ATM card service. And 150 samples size was requested to rate their bank ATM machine service.

3.4 Sampling Techniques:

In this research much importance was given to the right choice for the dimensions or elements which are taken for the sample so we can make it representative to our population. But before this, generally some sampling techniques are also discussed in this chapter. Three major types of sampling are:

• Probability sampling: Probability sampling is considered as the simplest type of sampling. It can be explained as in which every sample has the same probability which has been chosen.
• Purposive sampling:It is the one in which an individual who is selecting the sample is who is trying to construct the sample representative, depending on his view or purpose.
• No rule sampling:In this sampling technique we can easily take a sample without any rules or regulation. So in this sampling we have to gather data from same and homogenous population. Basically probability sampling is considered to be the most appropriate sampling technique and we can easily estimate the errors for the sampling.

Thus in this study convenience sampling technique is used.Convenience sampling is basically a type of non-probability sampling. It is used to collect data from population who are conveniently available to give us responses. With regard to this study convenience sampling incorporates all those individuals who were users and customers of ATM card and those who used this service most frequently. So this sample was chosen on the basis of convenience.

3.5 Research instrument:

In this research, questionnaire is used as our research instrument. The variables used in this study were measured on five point likert scale such as 1: strongly disagree, 2: disagree, 3: Neutral, 4: Agree, 5: strongly agree. The questionnaire is divided into two sections. First section of the questionnaire is about demographics. And the second section is about the dimensions of service quality which are used to measure the dependent variable in terms of customer satisfaction. SERVQUAL model is used and total 33 items are there in the questionnaire. And these items are divided into 7 components. Items in the questionnaire were in sequence with respect to the dimensions of service quality stated above. Questions 1-5 are under the dimension tangibility. Questions 6-11 are under the dimension reliability. Questions 12-17 are under responsiveness. Questions 18- 21 are under assurance. Questions 22- 24 are under empathy. Questions 25-28 are under security. And questions 29-33 are under the dimension customer satisfaction.

3.6 Data analysis techniques:

Different data analysis techniques are used in this study to measure the service quality and its impact on customer satisfaction. SPSS software is used in this research. Cronbach Alpha test is used to check the reliability of the questionnaire. Furthermore, correlation test, linear regression and ANOVA and normality are performed in this study.

Basically the study is started with a precise literature review of service quality in order to find out its major dimensions and underlying items. And this review is followed by all customers which may be student, salaried worker or self-employed.

CHAPTER 4

Results and Discussions

4.1 Reliability Test:

Table 1: Reliability Analysis

Reliabilityis tested by using CRONBACH Alpha Technique. There are multiple reports for the values of Cronbach Alpha which are acceptable. Usually its value ranges from 0.70 to 0.95. Low value of “Cronbach Alpha” is due to the least questions or due to no proper relationship between them. A research was conducted in 2003 and he provides some rules of thumb. (Gliem & Gliem, 2003) The reliability of this research which includes 33 items is 0.880. The result shows that our reliability is good.

Table 2: Item – test statistics

4.2 Demographic Analysis:

Gender:

Table 3 : Please indicate your gender?

The above table shows that 42% male and 58% females have given the responses through questionnaire.

Education level:

Table 4: Which of the following best describe your educational level?

The above table shows that 55.3% are graduates, 32% are post graduates and 12.7% are from others in respect to the educational level.

Occupation:

Table 5: Which of the following best describe your occupation?

The above table shows that 52% are students, 32.7% are salaried workers and 15.3% are self-employed.

Income:

Table 6: How much is your monthly income?

The above table shows that 62.7% are earning below 50 thousand, 20% are earning between 70000 -100000, 17.3% are earning above 100000.

The above table shows the frequencies and cumulative percentages of multiple banks which include HBL, ABL, DIB and many others. These are most of the banks which are used most frequently by the customers. Maximum responses are of HBL. It means many people are using the ATM services of HBL. Many customers are using the using of standard chartered, Meezan bank, Punjab Bank, NIB, NBP, Faisal Bank, Burj Bank and others.

4.3 Correlation Analysis:

Table 8: Correlation analysis

The above table shows Pearson correlation. The Pearson correlation shows the relationship between tangibility, reliability, responsiveness, assurance, empathy, security and customer satisfaction. The results in the table show that there is a strong positive relationship between tangibility, reliability, responsiveness, assurance, empathy, security and customer satisfaction. The result shows the value of tangibility is 0.425 which indicates that there is a weak positive relationship between tangibility and customer satisfaction. The result shows the value of reliability is 0.385 which indicates that there is a weak positive relationship between reliability and customer satisfaction. The result shows the value of responsiveness is 0.524 which indicates that there is a moderate positive relationship between responsiveness and customer satisfaction.The result shows the value of assurance is 0.642 which indicates that there is a strong positive relationship between assurance and customer satisfaction. The result shows the value of empathy is 0.582 which indicates that there is a moderate positive relationship between empathy and customer satisfaction. The result shows the value of security is 0.329 which indicates that there is a weak positive relationship between security and customer satisfaction.

4.4 Regression Analysis

Table 9: Variables entered

The above table shows that we check the variation in independent variable due to dependent variable.

Table 10: Model summary

The above table of Model Summary shows that the value of R is 0.723. And the value of R square is 52.3% which is greater than 50% and its means that model is good fit. In addition to this it means that 52.3% change dependent variable due to independent variable and other variation is due to error term.

Table 11: Anova

ANOVA table basically tells us that our model is significant or not. We have applied this test to check the variations in independent variable due to dependent variable. In the ANOVA table the value of F is 26.150 which reflect that is perfect. F value is calculated to measure the variability within different variables. The higher the value of F you can have the better results. On the other hand we have our main focus is on the significance level in the ANOVA table as other columns are used for intermediate computational reason. The value of significance is 000 and is less than 0.05 which means there is a strong relationship between service quality and customer satisfaction and the model is significant. F(6,143) = 26.150 p = 000

Table 12: Coefficients

The coefficient table also indicates that tangibility, responsiveness, reliability, assurance, empathy and security are influential on customer satisfaction. In the table tangibility (b=0.066) shows that it has the least impact on customer satisfaction and the p value (0.414) is greater than 0.05, it means it is not statistically significant.

The beta value of reliability is (b=0.029) which shows that it has a least impact on customer satisfaction. And the p value is (0.772) which is greater than 0.05 and it is not statistically significant. The coefficient of responsiveness is (b=0.106) which shows that it has a good impact on customer satisfaction. And the p value is (0.321) which is greater than 0.05 and is not significant. The coefficient of assurance is (b=0.405) which shows that it has a largest impact on customer satisfaction. And the p value is (000) which is less than 0.05 and is statistically significant. The coefficient of is empathy (b=0.242) which shows that it has a largest impact on customer satisfaction. And the p value is (000) which shows that it is statistically significant. The coefficient of security is (b=0.133) which shows that it has a positive impact on customer satisfaction. And the p value is (0.05) which shows that it is statistically significant.

4.5 Normality:

The normality graph of customer satisfaction (DV) shows that most of the data is under the bell shape. This means that the data is normal.

The first On the other hand second graph of Service quality also shows that maximum data is under the bell part, so data is considered to be normal.

The above QQ plots of dependent variable and independent variable shows that the data is normally distributed.

CHAPTER 5

Conclusions and Future Work

5.1 Conclusions:

This chapter is all about the results of the research. The purpose of our research is to investigate the impact of ATM’s service quality on customer satisfaction in banking sector of Pakistan. SERVQUAL model is used in this research to measure service quality.  In this research data analysis is done on SPSS software 21.

• In this research Cronbach Alpha is used for reliability test. The sample size is 150. And reliability test for 33 items is 0.880, which means that the reliability is good.
• The frequencies are calculated for the banks which were taken from responses. It was found that most customers are using the service of HBL. As the bank is offering good ATM services and also achieving customer satisfaction.
• Furthermore we have computed mean and standard deviation for different variables.
• We have taken multiple dimensions of service quality which are tangibility, reliability, responsiveness, assurance, empathy and security. Service quality (IV) is taken as an independent variable and customer satisfaction is our dependent variable. Correlation is applied on various dimensions to find out the effect of these dimensions on customer satisfaction.
• We have applied Pearson’s correlation test on our study. The result shows that all the dimensions such as tangibility, responsiveness, reliability, assurance, empathy and security (service quality IV) have positively significant relationship with customer satisfaction (DV). It means that if one variable increases there will be a significant increase in another variable.
• Next linear regression is applied, in which we have checked the significance level. And it also tells us the influential level of dependent variable on independent variable.
• Normality test is applied in order to check that the data we have collected through questionnaires is normal or not. So we find that we have a bell shaped histogram which shows that the data is normally distributed.

From the above study we have concluded that service quality (IV) plays an important role to achieve customer satisfaction (DV) in banking sector of Pakistan. So from the above results and analysis we can say that assurance and empathy has the highest impact on customer satisfaction (DV). And the value of significance is 000 which is less 0.05, which shows that there is a strong relationship between these variables. So H4, H5 and H6 are accepted and Ho is rejected. Furthermore tangibles, reliability and responsiveness have the least impact on customer satisfaction but have positive relationship with dependent variable. So it means that one unit increase in one variable have an increase in another variable. Thus H1, H2, H3 are also rejected whereas Ho is accepted.

5.2 Recommendations for improvement:

Service quality (IV) and customer satisfaction (DV) are considered as a most significant tool in banking services all across the world. The study is all about the vast investigation of service quality of Pakistani banking sector with respect to customer satisfaction. PARASURAMAN (Zeithaml, 1996) model is used to measure service quality. And it indicates that all the dimensions are very important in order to gain customer satisfaction.  There are many problems which may occur while using ATM service. This may decrease the customer satisfaction of customers. These problems may include:

• Unavailability of cash
• No backup system
• Cleanliness issue
• No proper security
• Unreadable slips
• Long queues
• Overcrowded ATM machines
• No quick replacement of ATM card and many more.

The major recommendations for improvement of service quality of ATM machine are to give a great importance on these problems so that we can easily resolve these issues. There must be proper security planning, numerous ATM machines must be there at every station so that customers should not wait for a long.

5.3 Limitations of this research:

Regardless of sincere efforts, this study has some limitations. Time constraint is one of the biggest limitations for this research. Time is too short to conduct a vast research on this topic. Additionally one independent and one dependent variable is used, multiple variables can be used for further study.

5.4 Future Work:

The data was collected from employees, students and others who are currently using ATM services from any bank in Pakistan. The sample size is also not too large, so further study can be done by large sample size. The research can also be conducted in any other geographical sector of Pakistan. As PARASURAMAN model is used to test the service quality of ATM machines with respect to customer satisfaction. Thus other service quality models can be used to test the quality of ATM machines.