Banking Sector Reforms and Customer Switching Intentions: Evidence from the Ghanaian Banking Industry

Abstract

The study examined factors influencing customers' switching intentions among retail banks after regulatory-induced mergers and acquisitions occasioned by banking sector reforms. The approach was quantitative through a survey design. Following a comprehensive review of extant literature, five antecedents were identified and conceptualised as determinants of switching intentions, and survey data were collected from 392 customers of the affected banks. Subsequently, partial least square structural equation modelling was used to test the research model. Empirical insights established direct relationships between price, reputation, and ineffective communication as antecedents to customer switching intentions in the context of regulatory-induced mergers and acquisition. The availability of suitable substitutes moderated the direct relations between price and switching intentions. This study is the first of its kind to interrogate switching intentions after a banking sector reform. It contributes to theory and practice by further interrogating the already empirically tested antecedents of switching in the context of regulatory-induced bank mergers and acquisitions. Additionally, the study enhances the switching literature by submitting evidence on the role of suitable substitutes as a moderator.