Abstract:

In Malaysia, there were 27 commercial banks, 16 Islamic banks and 12 investment bank, which provided financial services to the customers. Previous literatures showed that there were some similar and differences in bank selection criteria among undergraduate students. In this study, market failure and unprofitable banking business in Malaysia's banking industry was identified as one of the issues that alarming in banking sector. Thus, the purpose of this study was to identify the bank selection criteria among undergraduate students and the relationship between demographic characteristics and bank selection criteria. The bank selection criteria used in this study included (1) Convenience; (2) Financial benefits; (3) Bank reputation; (4) Technology-based services; and (5) Corporal efficiency. This study is a descriptive study which focuses on quantitative approach. A structred questionnaire was distributed to 375 respondent during September to November. However, only 320 questionnaire were returmed and valid for data analysis. Likert scale, frequency analysis and cross-tabulation analysis were used to analyzed the quantitative data. Findings shows that undergraduate students view the availability of 24 hour ATM services; high speed of transaction; financial stability of bank; highly confidentiality customer record; and good security management as the most importance criteria when selecting a bank. Furthermore, findings also indicated that there were some difference in bank selection criteria with respect to gender; age group; ethnic group; field of study and household income level. This findings contributed an overview of bank selection criteria among undergraduate students in Malaysia for banks to provide more appropriate marketing strategies to attract this market segement.