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Enhancing customer knowledge: the role of banks in financial well-being

Enhancing customer knowledge: the role of banks in financial well-being The purpose of this paper is to explore the role of banks in enhancing consumer knowledge aiming to increasing customer’s financial well-being.Design/methodology/approachThis research applied two quantitative studies with customers of banks in a Latin American country. The literature review and the results of the data analysis founded the development of a model that relates bank information transparency and subjective financial well-being through consumer financial knowledge.FindingsBy being transparent banks may transform the financial well-being of their customers. Particularly, this paper shows that consumer financial knowledge mediates the relationship between bank information transparency and the subjective financial well-being of individuals. However, the mediational effect occurs by subjective but not objective financial knowledge.Research limitations/implicationsThe mediational model of this research does not take in consideration the role that individual factors play in the exposition and processing of the information provided by banks and its final impact on the subjective well-being of individuals. Also, this paper does not explore potential moderators of the theoretical relationships neither include cultural variables in the analysis.Originality/valueFirm transparency has been related to various constructs in the marketing literature; however, its impact on consumer financial well-being is under-researched. This paper shows that companies need to aim to increase the subjective financial knowledge of their customers as a way to improve ultimate well-being of their customers. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Journal of Service Theory and Practice Emerald Publishing

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Publisher
Emerald Publishing
Copyright
© Emerald Publishing Limited
ISSN
2055-6225
DOI
10.1108/jstp-09-2017-0176
Publisher site
See Article on Publisher Site

Abstract

The purpose of this paper is to explore the role of banks in enhancing consumer knowledge aiming to increasing customer’s financial well-being.Design/methodology/approachThis research applied two quantitative studies with customers of banks in a Latin American country. The literature review and the results of the data analysis founded the development of a model that relates bank information transparency and subjective financial well-being through consumer financial knowledge.FindingsBy being transparent banks may transform the financial well-being of their customers. Particularly, this paper shows that consumer financial knowledge mediates the relationship between bank information transparency and the subjective financial well-being of individuals. However, the mediational effect occurs by subjective but not objective financial knowledge.Research limitations/implicationsThe mediational model of this research does not take in consideration the role that individual factors play in the exposition and processing of the information provided by banks and its final impact on the subjective well-being of individuals. Also, this paper does not explore potential moderators of the theoretical relationships neither include cultural variables in the analysis.Originality/valueFirm transparency has been related to various constructs in the marketing literature; however, its impact on consumer financial well-being is under-researched. This paper shows that companies need to aim to increase the subjective financial knowledge of their customers as a way to improve ultimate well-being of their customers.

Journal

Journal of Service Theory and PracticeEmerald Publishing

Published: Nov 26, 2020

Keywords: Transformative service research; Bank information transparency; Objective financial knowledge; Subjective financial knowledge; Subjective financial well-being

References