Switching costs and market power in the banking industry: The case of cooperative banks

The emergence of social payment and usage of social apps for buying and selling services and products was considered as threats to the banking industry. The usage of WeChat in China has fundamentally altered the whole digital communication landscape. WeChat has over 1.17 billion users. During the COVID-19 pandemic, WeChat implemented various plans to help recover from the COVID-19 pandemic, including consumer awareness, WeChat live stream communication platform, and one-to-one consultation through social media services to assist retailers and increase sales. In addition, they implemented WeChat Work 3.0 for remote working during the pandemic, cross-border e-commerce, and Mini Club Program to converts overseas brick-and-mortar shoppers to online members. WeChat and Facebook facilitated WeChat pay and Facebook pay through their social commerce platform because of market power. This chapter discusses the emergence of WeChat and how it impacts the payment systems.

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Honesty in Regional Cooperative Banks

Credit and Capital Markets – Kredit und Kapital ◽

10.3790/ccm.52.3.423 ◽

2019 ◽

Vol 52 (3) ◽

pp. 423-444

Author(s):

Kai-Oliver Maurer

Keyword(s):

Banking Industry ◽

Jel Classification ◽

Small Sample ◽

Control Group ◽

Business Culture ◽

Ethical Dimension ◽

Corporate Scandals ◽

International Bank ◽

Bank Employees ◽

Cooperative Banks

Abstract Corporate scandals are not a phenomenon that is unique to the banking industry. However, the examples of misconduct of individual bank employees or even of entire banks that popped up in recent years have promoted the interest in business culture and business ethics in the banking industry. Honesty is one important cultural and ethical dimension. Based on their results of a survey in a large, international bank Cohn et al. (2014a), for example, conclude that the banking industry’s business culture favours dishonest behaviour of employees. The present paper applies the design of Cohn et al. (2014a) to a small sample of regional cooperative banks in Germany in order to verify their outcome. The results of Cohn et al. (2014a) cannot be confirmed. There is no evidence of more dishonesty among employees of the banks in the sample relative to a control group. Business culture in the banking industry differs between banks or group of banks, a fact that needs to be considered e.g. by legislators. JEL Classification: C12, M14, G21, G41

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Switching costs in Islamic banking: The impact on market power and financial stability

Journal of Behavioral and Experimental Finance ◽

10.1016/j.jbef.2020.100409 ◽

2020 ◽

Vol 28 ◽

pp. 100409

Author(s):

Mohammad Dulal Miah ◽

Md. Nurul Kabir ◽

Md Safiullah

Keyword(s):

Market Power ◽

Financial Stability ◽

Switching Costs ◽

Islamic Banking ◽

The Impact

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Identifying brand touchpoints to increase switching costs in the banking industry

International Journal of Bank Marketing ◽

10.1108/ijbm-07-2019-0255 ◽

2019 ◽

Vol 38 (3) ◽

pp. 718-736 ◽

Cited By ~ 1

Author(s):

Abdullah Sultan

Keyword(s):

Factor Analysis ◽

Structural Equation ◽

Switching Costs ◽

Service Providers ◽

Banking Industry ◽

Service Failure ◽

Customer Experience ◽

Equation Modeling ◽

Exploratory Research ◽

Content Type

Purpose The purpose of this paper is to study the effect of staged customer experiences on customer switching costs in the banking industry. Design/methodology/approach Brand touchpoints in the banking industry are identified by exploratory research using focus group sessions with bank customers and staff and refined by exploratory factor analysis using an independent sample of bank customers to form the staged customer experience construct. The proposed research model is then validated by confirmatory factor analysis with an independent sample using structural equation modeling. Findings Customer experience in the banking industry consists of four related but distinct stages (i.e. pre-touch, in-touch, post-touch and service failure). The first three stages have direct and indirect effects on switching costs that are partially mediated by relationship quality. Research limitations/implications Customer experience is an industry-specific construct with complicated effects on switching costs. Thus, the staged customer experience construct should be examined in different industries and applications to understand its implications. Practical implications Bank customers demand experiences that achieve desirable results in everyday situations and switch to other service providers easily if this demand is not met. Banks should focus on brand touchpoints that are both important to customers and increase switching costs to keep customers from defecting. Originality/value This research expands upon findings in the customer experience literature by exploring factors that link staged customer experiences with switching costs in the banking industry. In addition, a paradox is identified in the staged customer experience model that requires managers’ attention in order to design an effective customer experience strategy.

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