IDENTIFYING CRITICAL FACTORS IN THE DEVELOPMENT OF A PROACTIVE SERVICE RECOVERY STRATEGY FOR ONLINE BANKING

This study investigates customer perceptions of service failure and recovery strategies in the context of online banking in Pakistan. The aims is to develop appropriate service recovery strategies based on customer needs and expectations. The study adopts a social constructivist epistemological position, recognizing the importance of social and cultural values in shaping customer perceptions and responses to service failure and recovery strategies. Data were collected through semi-structured in-depth interviews with customers using purposive sampling to gather data from customers who have experienced service failure and recovery, and from managers involved in recovery strategies. Thematic analysis was used to analyze the data, identifying key themes on the basis of relevant codes and key words. The study found that proactive service recovery strategies, effective communication channels, effective service recovery, compensation and incentives, and monitoring and improvement were all critical aspects of improving customer satisfaction and loyalty in online banking in Pakistan. The major implications of the study are that online banking providers need to understand customer needs and expectations.