Abstract:
Covid-19 brought unprecedented global business disruptions and the business
operational landscape has shifted drastically in recent months. This era is also
characterized by high levels of competition and assertive customers who make stay or
switch decisions guided by their quality and value perceptions. Evidence on effects of
mobile banking service quality, customer perceived value and customer retention
constructs in a single framework is limited. The study fills the gap. Specifically, this
study examines the effect of mobile banking service quality and customer-perceived
value on customer retention. It examines the mediating effect of customer perceived
value on the relationship between mobile banking service quality and customer
retention. The study is guided by the ‘leaky bucket theory’ of marketing and the MS-
QUAL model. An explanatory research design was adopted, employing multistage
sampling technique in collecting data from a sample of 400 consumers of mobile
banking services drawn from universities in Nairobi County using a self-
administered questionnaire. Data was analyzed and hypotheses tested using
hierarchical and multiple regression models using Hayes Process macro. The study
established that: mobile banking service quality (β= 0.565, p = 0. 000), perceived
customer value (β= 0.363, p = 0.000), significantly affect customer retention.
Additionally, the results show that customer perceived value mediates the relationship
between mobile banking service quality and customer retention (β =. 193, CI = .127,
.266). This study concludes that, customers will remain committed to patronize a bank
whose services are of high quality and with a high value. The study contributes to
knowledge by revealing customer perceived value mediates the relationship between
mobile banking service quality and customer retention. Policy makers should
proactively respond to sudden disruptions by developing quality assurance policies and
devising value-centered strategies that enhances customer retention rates
