This paper examines the service quality dimensions of Indian private banks dealing with retail banking. Overall service quality level acts as an antecedent for customer satisfaction. The factors extracted give perceived service quality dimensions which correlate with overall attitudinal loyalty. Overall service quality further tested for any significant relationship with attitudinal loyalty, which is considered to be an important component of retaining valued customers. The data has been collected from 100 valued customers of two private retail banks of Tiruchirapalli. A questionnaireelicited information on socio-demographic variables along with SERVQUAL dimensions of service quality added with three extra contemporary validated variables and attitudinal loyalty variables. The results suggest that responsiveness and reliability of service quality dimensions determine customer satisfaction more than the assurance, empathy and tangible aspects (SERVQUAL score analyzed using Factor Analysis and Multiple Regressions). Overall perceived service quality fosters customer's attitudinal loyalty through latent customer satisfaction (Tested using Chi-Square Statistics and Correlation Analysis). Increase in service quality of the banks can satisfy and develop attitudinal loyalty which ultimately retains valued customers.

Financial liberalization has led to intense competitive pressures and private banks dealing in retail banking are consequently directing their strategies towards increasing service quality level which fosters customer satisfaction and loyalty through improved service quality. Private banks dealing in retail banking are pursuing this strategy, in part, because of the difficulty in differentiating based on the service offering. Typically, customers perceive very little difference in the banking products offered by private banks dealing in services as any new offering is quickly matched by competitors.

The studies by Parasuraman et al. (1985) and Zeithaml et al. (1990) noted that the key strategy for the success of any business institution is the deliverance of quality services to customers. The quality of services offered will determine customer satisfaction and attitudinal loyalty. For this reason, research on customer satisfaction and attitudinal loyalty is often closely associated with measurement of service quality. As globalization and liberalization of financial institutions accelerate, competition among banks in offering products and services becomes more intense. Customers in India become more educated, better informed, more internalized, and as Indian economy becomes more and more knowledge-based, the demand for high quality services expands with increases in customers' buying power. The financial sector reform in India was designed to infuse "greater competitive vitality in the system". To achieve this objective, the `Narasimhan Committee' was established. The Narasimhan Committee report suggested wide ranging reforms for the Indian banking sector in 1992 to introduce internationally accepted banking practices and enable Indian banks (which were hitherto resisting liberalization and opening of their markets) to achieve service excellence.

This paper endeavors to fill the gap in the service quality which determines customer satisfaction and attitudinal loyalty literature by exploring the dimensions of customer perceived service quality in the context of Indian retail banking industry. A set of service quality variables have been drawn from customers' perceptions about service quality as well as bank marketing and service quality literature. These parameters have been used in the context of two of the largest private banks dealing with retailing banking (ICICI and HDFC) to identify the underlying dimensions of service quality which determine customer satisfaction and attitudinal loyalty. Finally, the paper presents the findings of the service quality dimensions and its correlation with attitudinal loyalty to contend the initiatives that banks can enhance employees' skills and attitudes, and instill a customer-service culture.

Management Research Journal, Private Retail Banking, Retailing Banking, Globalization, Banking Products, Indian Banking Sector, Bank Marketing, Commercial Banking, Public Sector Banks, Managerial Implications, Attitudinal Loyalty.