Drop-out risk measurement of E-banking customers

Abstract

During the last decade, the national financial markets have shown a great transformation that has failed to reduce the high rate of existing banking in spite of the current financial crisis. This high level of competition makes financial institutions concerned about the loyalty of their customers to maintain or increase their market share and profitability. In this chapter, the authors propose a statistical model that measures the risk of customers dropping out of a Spanish financial institution, and this is a widespread method for the financial sector in general. The risk depends on socio-demographic and economic factors, as well as-most importantly-on the levels of satisfaction and trust that the bank produces in customers. Research shows that the proposed model can help institutions to know which customers have a greater risk of dropping out and, therefore, establish some recommendations for their loyalty. © 2015, IGI Global.