The client’s behaviour towards the bank in Algeria (Public Bank Vs Foreign Bank)

Abstract

This paper summarizes the arguments and counterarguments within the scientific discussion regarding the behavioral aspects of customer choice of state or foreign bank banking services. The purpose of the study is to study and analyze the behavior of customers when choosing a bank category (state or foreign) to obtain banking services. In order to test the scientific hypotheses, we conducted a survey of clients and bank managers of 12 banks (6 states and 6 foreign). In Algeria, a separate range of financial transactions (in particular, housing lending and investment programs) is entrusted to state-owned banks only, so clients in Algeria do not leave state-owned banks, even if they also start servicing higher-quality foreign banks. The processing of the survey results showed that the key factors that determine the priorities in choosing clients of a state or foreign bank are: the reputation of the bank; tips from friends or acquaintances advice of a bank employee; accident; bank advertising (for foreign banks only). In addition, the choice of the bank by a client in Algeria is influenced by behavioral and institutional factors such as religion, traditions, and social customs. The survey found that just over half of the customers were satisfied with the services of state-owned banks, while 85% were completely satisfied with new banking technologies, ease of use and time savings among foreign bank clients. The main factors that determine the level of customer satisfaction with banking services are ease of knowing cash and payment for services; highly efficient organization and simplicity of credit mechanisms; adherence to the principles of Islamic finance by some foreign banks (alternative finance, where loans and savings do not imply interest rates); more advanced banking services (mainly for foreign banks). Keywords: bank, state bank, foreign bank, customer, competition, bank reputation, banking.