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912

JOSS :

Journal of Social Science

INCREASED CUSTOMER LOYALTY: THE ROLE OF SERVICE QUALITY,

TRUST, SATISFACTION, AND BUSINESS PROCESS IMPROVEMENT AS

MEDIATION

ST Prijono Budi Tjahjono

, Kandi Sofia Senastri Dahlan

Universitas Bunda Mulia Tangerang, Indonesia

Email: [email protected]

, [email protected]c.id

KEYWORDS

Service quality,

trust, customer

satisfaction,

customer loyalty,

and business

process

improvement.

ABSTRACT

This study aims to analyze more deeply the relationship and influence of

Service Quality, Customer Trust, and Satisfaction on Customer Loyalty of

Non-Program Small Medium Enterprise (SME) Credit Customers

Mediated by Business Process Improvement (Empirical Study: Bank BTN

Regional Office 2). An online survey using Google Forms to SME credit

customers of Bank BTN Regional Office 2 covering DKI Jakarta and

Banten was used to collect data as material for this study. In this study the

variables Service Quality, Customer Trust and Satisfaction as dependent

variables, Customer Loyalty as an independent variable, and Business

Process Improvement as mediation variables. 226 respondents met the

respondent criteria. This study used Partial Least Square SEM also called

PLS-SEM. The results prove that Service Quality affects Business Process

Improvement, Trust affects Business Process Improvement, Customer

Satisfaction affects Business Process Improvement, Service Quality affects

Customer Loyalty, Trust does not directly affect Customer Loyalty,

Customer Satisfaction does not directly affect Customer Loyalty,

Business Process Improvement affects Loyalty Customers, Business

Process Improvement affects mediating Service Quality on Customer

Loyalty, Business Process Improvement affects mediating Trust in

Customer Loyalty, and Business Process Improvement has an effect

on mediating Customer Satisfaction with Customer Loyalty.

INTRODUCTION

The important function and role of the banking industry in economic activity at this time

cannot be ignored, because by providing credit services and various services, banks can support

various sectors of the economy and trade (Setiawan & Sukiman, 2020). By Article 1 Paragraph

1 of Law No. 10 of 1998 concerning Amendments to Law No. 7 of 1992 concerning Banking,

it is stated that: "Banking is everything that concerns banks, including institutions, business

activities, and ways and processes in carrying out their business activities". Article, Verse .2,

states that a "Bank is a business entity that collects funds from the public in the form of deposits

and distributes them to the public in the form of credit and/or other forms to improve the

standard of living of the people".

Volume 2 Number 10 Oktober 2023

p- ISSN 2963-1866- e-ISSN 2963-8909

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Table 1

Number of Banks and Bank Offices in Indonesia

Bank and office groups

Number of banks and bank offices (Units)

Bank

Bank offices

2019

2020

2021

2019

2020

2021

Conventional commercial banks-

persero banks

17622

17307

18166

Conventional commercial banks-

regional development banks

4212

4226

5122

Conventional commercial banks-

national private banks

7352

7144

7193

Conventional commercial banks-

branch offices of foreign banks

Sharia commercial banks-

regional development banks

184

195

190

Sharia commercial banks-

national private banks

1721

1825

1833

Number of commercial banks

110

109

107

31127

30733

32531

Source: BPS-RI, accessed June 1, 2023

According to statistical data as mentioned in Table_1 above, it is known that the number

of commercial banks in Indonesia in 2021 is 107 units. Meanwhile, Bank Indonesia (BI) noted

that the number of commercial banks in Indonesia in 2022 was 106 units. The number of

commercial banks decreased by one unit compared to the previous year which was 107 units.

(Pertiwi, K.B.Sofiati, N.A. & Sudarso, 2021) explained that currently, the banking sector

in Indonesia is becoming tighter during the day, with all banks trying hard to increase their

assets and profits to win the competition, especially amid ongoing economic globalization and

advances in information technology that are developing and spreading so quickly. In (Carolleta

& Elpanso, 2022) suggest that in the increasingly fierce competition among banks, they

actively seek to attract customer attention by improving their services and performance. Today,

businesses need to realize that they need to understand the various factors that influence

customer loyalty, such as switching costs, trust, company image, and customer satisfaction, all

of which can help build a loyal customer base. High-quality service or excellence is the key to

creating customer satisfaction, increasing loyalty, and expanding market share through

attracting new customers and improving financial performance (Nuraina & Arafah, 2020).

In his book, (Kasmir, 2017), states that service is an effort or activity carried out by

individuals or organizational entities to provide satisfaction to customers or customers.

According to (Ahmad et al., 2022) research stated that service quality includes all

characteristics and attributes possessed by a service or product that have an impact on its ability

to meet needs that may not be explicitly expressed, as stated by (Kotler et al., 2016). In their

research, (Setiawan & Sukiman, 2020), explained that the introduction and assessment of

service quality are expected to trigger a sense of satisfaction for customers because quality is

seen as a parameter of service quality that has the potential to provide varying levels of

satisfaction for customers, both objectively and based on their perceptions. Quality criteria or

service quality emphasizes the need for service providers to provide services with efficiency

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and timeliness to meet customer needs effectively (Famiyeh et al., 2018). Quality of service

that generates satisfaction for customers on an ongoing basis will encourage them to remain

loyal or loyal and still choose to continue using the services of the company.

The banking industry is a form of service business that relies heavily on the principle of

trust, as affirmed by (Purwoko & Astuti, 2017), that trust is an element that is often the main

focus in research on interactions between persons and relationships with customers. According

to (Mansouri et al., 2022) in their research stated that the core of the relationship between

companies and consumers is trust, which is a key element in building a strong bond between

the two. Trust has been proven to be one of the factors that affect the level of commitment and

efficiency in an organization, as stated by (Flavián et al., 2019), and has a significant impact

on the level of brand loyalty or brand. Previous research or studies have proven that customers

to the brand.

According to (Sigit & Soliha, 2017) in their research stated that customer loyalty reflects

a strong commitment to continue buying products or services that they have enjoyed in the

future, even in the face of changing situations or marketing efforts that may try to change their

behavior. In other words, customers will remain loyal and committed to making repeat

purchases on an ongoing basis. To maintain customer loyalty, it is not only enough to be

satisfied, but more crucial is to build trust, because customer trust is key in relationship

marketing practices. Loyalty can be explained as the formation of attitudes and patterns of

behavior of a consumer about the purchase and use of products, which are influenced by

previous experiences they have experienced (Griffin, 2015). If the banking sector can exceed

customer expectations, customers will be more inclined to consider the brand, offer, and

message provided by the bank. In a study conducted by (Setiawan & Sukiman, 2020), they

suggest that loyalty is how consumers express their choice of a brand and the desire to continue

to invest in the relationship, according to the concept described by (Zichermann & Linder,

2010). When the company can meet consumer needs, consumers will feel loyal and have an

attachment to the company, which then encourages them to continue to take advantage of the

services provided by the company.

When viewed from several previous studies, (Sigit & Soliha, 2017) stated that product

quality or quality affects the level of customer satisfaction. Quality or quality of service affects

the level of customer satisfaction. Product quality or quality affects the level of customer

loyalty. Quality or quality of service affects the level of customer loyalty. Satisfaction affects

the level of customer loyalty. According to (Nurdin, I., Sofiati, N.A. & Sudaryo, Y., 2019)

stated that it was found that the quality of service in applying for credit had a significant impact

or influence on the level of loyalty-customers at PT. Bank Tabungan Negara (Persero) Tbk. In

addition, the quality of service in providing credit also affects credit customer satisfaction,

which in turn results in an influence on the level of credit customer loyalty at PT Bank

Tabungan Negara (Persero) Tbk either individually or in a concurrent influence. (Setiawan &

Sukiman, 2020), stated that in this study, there were two variables found to have a positive and

significant relationship with each other, namely the level of customer satisfaction and customer

loyalty. The results showed that the level of credit customer satisfaction had a positive and

significant impact on the level of credit customer loyalty. Overall, the variable of debtor

satisfaction was found to act as a mediator in the relationship between each dimension of

service quality and debtor loyalty. The results of research conducted by (Manyanga et al., 2022)

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show that customer experience, satisfaction level, and intention to provide recommendations

positively through word of mouth positively affect customer loyalty levels.

Meanwhile, the results of different studies stated by (Salim, N.D.) stated that the results

showed that the direct relationship between the level of customer linkage with the bank, either

through satisfaction or complaint handling, did not significantly increase the level of customer

loyalty. However, service directly affects customer satisfaction. Similarly, the image of the

bank, both directly and through satisfaction, has a positive influence on customer loyalty. The

more positive the perception of the image of the bank, both directly and through satisfaction,

will have a positive impact on the level of customer loyalty. Higher customer satisfaction

directly contributes to an increase in customer loyalty levels. In this study, customer

satisfaction plays an important role as a significant mediator in linking various factors with

customer loyalty levels. In research conducted by (Supriyanto et al., 2021), findings show that

does not have a significant impact on customer loyalty levels. On the contrary, service quality

affects levels significantly, which then acts as a significant link in influencing customer loyalty

levels.

Based on data until June 30, 2023, the concept of research with this focus has never been

studied by other researchers. This study or research is carried out at PT. Bank Tabungan Negara

(Persero) Tbk., especially in Regional Office 2 which covers DKI Jakarta and Banten which is

one of the supporting industries for the Non-Program Small Medium Enterprise (SME) credit

sector.

From the research background that has been described earlier, it can be formulated as

follows: identification of research problems on Quality-Service, Satisfaction-Customer has

important factors that affect the Business Process Improvement of Small Medium Enterprise

(SME) Credit Customers. Business Process Improvement has important factors that affect the

Loyalty-Customer of Small Medium Enterprise (SME) Credit, Quality-Service, Trust and

Satisfaction-Customer has an important factor that affects the Loyalty-Customer of Small

Medium Enterprise (SME) Credit Customers. Quality-Service Satisfaction-Customer mediated

by Business Process Improvement are important factors that influence Customer Loyalty of

Non-Program Small Medium Enterprise (SME) Credit Customers (Erfianto, 2019).

The purpose of this study is to analyze more deeply the relationship and influence of

Service Quality, Customer Trust, and Satisfaction on Customer Loyalty of Non-Program Small

Medium Enterprise (SME) Credit Customers Mediated by Business Process Improvement

(Empirical Study: Bank BTN Regional Office 2). The purpose of the study is To analyze the

effect of Service Quality on Business Process Improvement of Non-Program Small Medium

Enterprise (SME) Credit Customers, To analyze the effect of Trust on Business Process

Improvement of Non-Program Small Medium Enterprise (SME) Credit Customers, To analyze

the effect of Customer Satisfaction on Business Process Improvement of Small Medium

Enterprise (SME ) Credit Customers Non-Program, To analyze the effect of Business Process

Improvement on Customer Loyalty of Non-Program Small Medium Enterprise (SME) Credit

Customers, To analyze the effect of Service-Quality on Customer Loyalty of Non-Program

Small Medium Enterprise (SME) Credit Customers, To analyze the effect of Trust on Customer

Loyalty of Non-Program Small Medium Enterprise (SME) Customers, To analyze the effect

of Trust on Customer Loyalty of Non-Program Small Medium Enterprise (SME) Customers,

To analyze the effect of Service-Quality on Loyalty-Customers of Customers Loyalty-

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Customers of Small Medium Enterprise (SME) Non Program, To analyze the effect of

Customer Satisfaction on the Loyalty-Customer of Non-Program Small Medium Enterprise

(SME) Credit Customers of Loyalty-Customer of Small Medium Enterprise (SME ) Credit

Customers Non-Program mediated by Business Process Improvement, To analyze the effect of

Trust on Customer Loyalty of Non-Program Small Medium Enterprise (SME) Credit

Customers mediated by Business Process Improvement, To analyze the effect of Customer-

Satisfaction Credit Customers Non-Program mediated by Business Process Improvement. The

results of this research are expected to contribute to and benefit the scientific development of

strategic management, for the banking industry, for policymakers, and for other researchers.

METHOD RESEARCH

Research Design

Sekaran and Bougie (2020), explained that research design is a comprehensive plan that

includes stages from the beginning of making hypotheses to the final data analysis, which will

later produce conclusions and suggestions or recommendations.

The method or approach used in this study is the quantitative method. According to

(Hardani et al., 2020), quantitative methods are research approaches that are carried out

systematically, well planned, clearly structured from the beginning to the end of the study, and

are not affected by the situation in the field. For this reason, quantitative research, as stated by

(Siyoto & Sodik, 2015) in (Hardani et al., 2020), tends to have strong characteristics in

numerical aspects, ranging from collection, and analysis, to presentation of data that uses

numbers as its basis.

Operationalization of Variables (Variables) &; Variable Measurement Scales

(Campos et al., 2020) define a variable as an entity that can take on a variety of different

values. In the context of research, four types of variables are generally used, namely

independent variables, dependent variables, moderation variables, and mediation variables. In

this study, we used several variables, including the dependent variable, the independent

variable, and the mediation variable. The dependent variable is the main variable that is the

main focus of the study and becomes the final goal of this study. This study or research only

involves 3 (three) types of variables, namely:

1. 3 (three) independent variables, namely Service Quality, Customer Trust, and Satisfaction

which means that a variable has a positive or negative impact on the dependent variable

(Campos et al., 2020).

2. One dependent variable, namely Loyalty_Customer which means the main variable studied

by the researcher and is the ultimate goal of the research (Campos et al., 2020).

3. One variable mediates (intervening), namely Business Process Improvement which means

variables that play a role in maximizing the function of independent variables in their

influence on dependent variables (Campos et al., 2020).

An independent variable is a variable that can influence the dependent variable. In a more

practical context, independent variables are often considered as solutions to a problem. This

study used three main independent variables, namely Service Quality, Trust, and Customer

Satisfaction. On the other hand, the dependent variable in this study is Customer Loyalty. In

addition, there are mediation variables that function to maximize the role of independent

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variables in influencing dependent variables. The mediating variable in this study is Business

Process Improvement.

RESULTS AND DISCUSSION

Results of Descriptive Analysis Related to Respondent Profiles and Indicators

Based on the results of the questionnaire that has been distributed online to customers of

Small Medium Enterprise (SME) Non-Program Bank BTN Regional Office 2 (DKI and

Banten) loans through Google form, the number of respondent samples that have been obtained

is 226 respondents. After the screening process, the total number of samples can be used as

sample data in this study because it meets the research requirements that have been set. This

number has met the minimum limit in this study, for the minimum number this study is 224

respondents, which is obtained from the calculation of the number of indicators, namely 28

times eight, using the theory of (Hair et al., 2019), the minimum number of samples is the total

number of indicators of researchers multiplied by five.

Table 2

Respondent Results by Gender

Gender

Sum

Percentage

Man

168

75,34%

Woman

25,66%

TOTAL

226

100%

Source: Respondent questionnaire results, (2023)

Based on the information contained in Table 2, it can be seen that the results of

respondent data based on sex that have been obtained are 168 people (75.34%) male and 58

people (25.66%) female. From the tabulation data, it can be seen that the majority of Non-

Program Small Medium Enterprise (SME) credit customers at Bank BTN Regional Office 2

(DKI and Banten) who were respondents in this study were male.

Table 3

Respondents' Results by Age

Age

Sum

Percentage

17 – 30 Years

5.31%

31 – 40 Years

17,70%

41 – 50 Years

120

53.10%

> 50 years

23.89%

TOTAL

226

100%

Source: Respondent questionnaire results, (2023)

Based on the information contained in Table 3, it can be seen that the results of

respondent data based on the age obtained, it is known that there are 12 people (5.31%) aged

between 17 – 30 years, 40 people (17.70%) aged between 31 – 40 years, 120 people (53.10%)

aged between 41 – 50 years and 54 people (23.89%) aged > 50 years. So it can be stated that

the majority of Non-Program Small Medium Enterprise (SME) credit customers at Bank BTN

Regional Office 2 (DKI and Banten) who were respondents in this study were aged between

41 – 50 years.

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Table 4

Respondents' Results Based on Recent Education

Recent Education

Sum

Percentage

High School or Equivalent

3.98%

7.08%

178

78.76%

10.18%

TOTAL

226

100%

Source: Respondent questionnaire results, (2023)

Based on the information contained in Table 4, it can be seen that the results of

respondent data based on the last education obtained, it is known that there are 9 people (3.98%)

who have a final high school education or equivalent, 16 people (7.08%) who have a final

education of D3, 178 people (78.76%) who have a final education of S1 and 23 people

(10.18%) who have a final education of S2. So it can be stated that the majority of Non-

Program Small Medium Enterprise (SME) credit customers at Bank BTN Regional Office 2

(DKI and Banten) who were respondents in this study had S1 final education.

Table 5

Table of Respondent Results by Assets Owned

Assets Owned

Sum

Percentage

< IDR 50 million

9.29%

Rp. 50 million up to Rp.500

million

4.87%

'> Rp.500 million to IDR 10 M

182

80.53%

'> Rp.10 M

5.31%

TOTAL

226

100%

Source: Respondent questionnaire results, (2023)

Based on the information contained in Table 5, it can be seen that the results of

respondent data based on assets owned are known that there are 21 people (9.29%) have assets

less than Rp.50 million, 11 people (4.87%) have assets greater than Rp.50 million to Rp.500

million, 182 people (80.53%) have assets greater than Rp.500 million to Rp.10 billion, and 12

people (5.31%) have assets greater than Rp.10 billion. So it can be stated that the majority of

Non-Program Small Medium Enterprise (SME) credit customers at Bank BTN Regional Office

2 (DKI and Banten) who are respondents in this study have assets greater than Rp.500 million

to Rp.10 billion.

Descriptive STatistic Test Results

Descriptive statistical tests are used to determine the average value of indicators, Table

6 shows the statistical results of descriptive tests.

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Table 6

Descriptive Statistical Test Results

Item Code

Answer Response

Mean

Standard

Deviation

Service Quality

SQ1

Bank BTN provides

concrete evidence of

good office Physical

Facilities

126

4.509

0.611

0.88%

3,54%

39,82%

55,75%

SQ2

Bank BTN provides

concrete evidence of

good Employee Human

Resources

102

110

4.412

0.647

1.33%

4.87%

45.13%

48.67%

SQ3

Bank BTN provides

concrete evidence of

good communication

105

109

4.420

0.635

1.33%

3.98%

46.46%

48.23%

SQ4

Bank BTN provides

services to customers in a

responsive manner

105

4.319

0.701

1.77%

8.41%

46.46%

43.36%

SQ5

Bank BTN guarantees

adequate knowledge of

its staff

119

4.319

0.655

1.77%

5.31%

52.65%

40.26%

SQ6

Bank BTN guarantees a

good attitude of its staff

107

102

4.367

0.660

1.33%

6.19%

47.34%

45.13%

SQ7

Bank BTN guarantees the

trustworthy nature of its

staff.

122

4.217

0.666

0.88%

11.06%

53.98%

34.07%

SQ8

Bank BTN

communicates well and

attentively with its

customers

126

4.323

0.615

1.33%

3.98%

55.75%

38.94%

SQ9

Bank BTN understands

the needs of its customers

117

4.319

0.655

1.77%

5.75%

51.77%

40.71%

SQ10

Bank BTN can provide

the promised service

immediately.

131

4.155

0.683

2.21%

10.18%

57.96%

29.65%

SQ11

Bank BTN can provide

the promised services

satisfactorily.

124

4.190

0.687

1.77%

10.62%

54.87%

32.74%

Source: Respondent questionnaire results, (2023)

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Based on the information contained in Table 6, it can be seen that:

1. The average value of the highest indicator of Service Quality is SQ1 where respondents feel

that Bank BTN provides concrete evidence of good office physical facilities.

2. The average value of the highest indicator of Trust is T2 where respondents feel that Bank

BTN maintains, fulfilling agreements made with customers.

3. The average value of the highest indicator of Customer Satisfaction is CS2 where

respondents feel that Bank BTN provides information at every stage of the credit process to

its customers.

4. The average value of the highest indicator on Business Process Improvement is BPI1 where

respondents are willing to submit appropriate information for Business Process

Improvement.

5. The average value of the highest indicator of Customer Loyalty is L1 where respondents are

willing to always maintain commitment.

Test Instruments

Data has been collected and analyzed with the help of SEM models using the SmartPLS

application version 4.0 Partial Least Square (PLS), which is an alternative method in

Structural Equation Modeling (SEM) used to overcome various problems in SEM (Haryono,

2017).

Evaluasi Outer-Model

Evaluation of the outer model is carried out to assess the validity and reliability of the

model. Outside models that use reflexive indicators are evaluated through convergent validity,

discriminant validity, and composite reliability testing for their indicator blocks (Ghozali and

Latan, 2015). During this stage, SEM model diagrams are also developed to visualize the causal

relationships to be tested to facilitate understanding.

Table 7

Validity Test Results

Variable

Item Code

Outer Loading

Information

Service

Quality

SQ1

0.865

Valid

SQ2

0.923

Valid

SQ3

0.875

Valid

SQ4

0.903

Valid

SQ5

0.904

Valid

SQ6

0.907

Valid

SQ7

0.843

Valid

SQ8

0.87 5

Valid

SQ9

0.884

Valid

SQ10

0.875

Valid

SQ11

0.880

Valid

Trust

0.939

Valid

0.925

Valid

0.918

Valid

0.778

Valid

0.921

Valid

(Customer

Satisfaction)

CS1

0.951

Valid

CS2

0.937

Valid

CS3

0.947

Valid

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(Business

Process

Improvement)

BPI1

0.968

Valid

BPI2

0.979

Valid

BPI3

0.973

Valid

BPI4

0.946

Valid

BPI1

0.968

Valid

Customer

Loyalty

0.948

Valid

0.951

Valid

0.921

Valid

0.955

Valid

Source: SmartPLS Data Processed 4, (2023)

Based on the information obtained in Table 7 above, it can be seen that all indicators of

each research variable have an Outer Loading > 0.7 so that all indicators are declared valid,

whereas an indicator is declared valid if it has an Outer Loading value greater than 0.7.

From the results of the outer loading value in Table 7, it is obtained that:

1. The highest indicator of Service Quality is SQ2 with a value of 0.923 where respondents

feel that Bank BTN provides concrete evidence of having good Human Resources.

2. The highest indicator of Trust is T1 with a value of 0.939 where respondents feel that Bank

BTN serves customer needs on an ongoing basis.

3. The highest indicator of Customer Satisfaction is CS1 with a value of 0.951 where

respondents feel that Bank BTN provides quality credit products to its customers.

4. The highest indicator of Business Process Improvement is BPI2 with a value of 0.979 where

respondents are willing to comply with the credit process according to the provisions.

5. The highest indicator of Customer Loyalty is L4 with a value of 0.955 where respondents

are willing to make repeat purchases.

The Effect of Service Quality on Business Process Improvement

Quality of Service to Business Process Improvement has a p-value of 0.008 < 0.05, then

H1 (First Hypothesis) is accepted. This means that Service Quality has a positive and

significant effect on Business Process Improvement. Quality of service by providing tangible

evidence, responsiveness by providing services to customers quickly; Assurance, Empathy,

and Reliability implemented by Bank BTN properly and consistently can improve service

quality so that it affects business process improvement.

The results of this hypothesis are consistent with previous research conducted by

(Harimurti & Suryani, 2019). Their research on the Effect of Total Quality Management on

Service Quality, as well as the impact of Service Quality on Customer Engagement and

Customer Loyalty in the banking industry, also shows that the implementation of Total Quality

Management has a positive impact on Service Quality. In line with the results of research by

(Lenka et al., 2010), Damador Suar, and Pratap K.J. Mohaprata (2010) who examined the

problem of employee job satisfaction and affective commitment having a positive influence on

service quality.

The Effect of Trust on Business Process Improvement

Trust in Business Process Improvement has a p-value of 0.006 < 0.05, hence H2 (Second

Hypothesis) is accepted. This means that trust has a positive and significant effect on business

process improvement. Bank BTN provides trusting beliefs by serving customer needs on an

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ongoing basis; maintaining, fulfilling agreements made with customers; and being able to meet

customer needs, and customers are willing to accept risks or negative consequences that may

occur and are willing to provide information, follow suggestions or requests to make Trust

affect Business Process Improvement.

The results of this hypothesis are in line with research conducted by (Tahir Jan &

Abdullah, 2014) which identified and tested Critical Success Factors related to technology

and its impact on customer trust and satisfaction, successfully revealed that technological

Critical Success Factors positively affect customer satisfaction. Also, trust partially mediates

the relationship between technology's Critical Success Factors and customer satisfaction. The

significant positive influence of technology's Critical Success Factors on trust, and trust in

customer satisfaction is also gained.

The Effect of Trust on Customer Loyalty

Trust in Customer Loyalty has a p-value of 0.288 > 0.05, so H5 (Fifth Hypothesis) is

rejected. This is also shown by the very small Effect Size or F-Square value of 0.008. This

means that Trust has no effect on Customer Loyalty or it can be said that the relationship or

correlation is not significant. Trust indicators, namely providing trusting beliefs and trusting

intentions to customers of Bank BTN Non-Program Small Medium Entreprise (SME) credit

customers Regional Office 2 (Banten and DKI) do not affect Bank BTN credit customers to

become loyal to Bank BTN.

The results of this hypothesis are in line with research conducted by (Winasih & Hakim,

2021) which examined the Role of Satisfaction as a Mediating Variable of Service Quality and

Customer Trust in Sharia Bank Customer Loyalty, one of the results of his research stated that

Customer Trust does not affect Customer Loyalty. In line with research conducted by (Firdaus,

2014) which also shows that Customer Trust does not significantly affect Customer Loyalty.

The Effect of Service Quality on Customer Loyalty is mediated by Business Process

Improvement

Service Quality mediated by Business Process Improvement on Customer Loyalty has a

p-value of 0.018 < 0.05, hence H8 (Eighth Hypothesis) is accepted. This means that Business

Process Improvement has a positive and significant effect on mediating Service Quality on

Customer Loyalty.

The results of this hypothesis are in line with research conducted by (Harimurti &

Suryani, 2019), which examined the Effect of the Application of Total Quality Management

on Service Quality, the Influence-Quality of Service on Customer and Customer Loyalty in the

banking industry which one of the results stated that Total Quality Management has a positive

effect on Service Quality, Service Quality has a positive effect on Customer Engagement and

Customer Loyalty and Customer Engagement has a positive effect on Customer Loyalty. In

line with research conducted by (Nisazizah & Sudaryanto, 2018), which examined the issue of

the Effect of Service Quality, Customer Value, and Customer Relationship Management on

Customer batisfaction and Customer Loyalty, the results of this study show that customer

relationship management Positive effect on customer satisfaction, service quality has a positive

effect on customer loyalty, customer value has a positive effect on customer loyalty, customer

relationship management has a positive effect on customer loyalty, and customer satisfaction

has a positive effect on customer loyalty.

The effect of Trust on Customer Loyalty is mediated by Business Process Improvement

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Trust-mediated Business Process Improvement on Customer Loyalty has a p-value of

0.009 < 0.05, hence H9 (Ninth Hypothesis) is accepted. This means that the variable Business

Process Improvement has a positive and significant effect on mediating Trust in Customer

Loyalty. Based on testing the hypothesis of direct influence, the Trust variable does not affect

the Customer Loyalty variable, with the mediation of Business Process Improvement showing

positive and significant influence results.

The results of this hypothesis are in line with the research of (Utami et al., 2019) which

examines the effect of service quality and customer trust on customer loyalty also shows that

service quality has a significant effect on customer loyalty, resulting in that customer trust has

a significant effect on customer loyalty. The results of this study are also in line with research

conducted by (Sari et al., 2018), which focuses on the implementation of Customer

Relationship Management (CRM) as one of the strategies that help banks build long-term

relationships with customers. The purpose of the study is to increase company profits and

understand the implementation of CRM and the most influential factors on customer

satisfaction and loyalty. One of the findings of this study is that Customer Relationship

Management variables have a significant influence on customer loyalty.

The effect of Customer Satisfaction on Customer Loyalty is mediated by Business Process

Improvement

Customer Satisfaction mediated by Business Process Improvement on Customer Loyalty

has a p-value of 0.013 < 0.05, hence H10 (Tenth Hypothesis) is accepted. This means that the

variable Business Process Improvement has a positive and significant effect on mediating

Customer Satisfaction with Customer Loyalty. Based on testing the hypothesis of direct

influence, the Customer Satisfaction variable does not affect the Customer Loyalty variable,

with the mediation of Business Process Improvement showing positive and significant

influence results.

The results of this hypothesis are in line with research conducted by (Nisazizah &

Sudaryanto, 2018), which focused on the influence of Service Quality, Customer Value, and

Customer Relationship Management on Customer Satisfaction and Customer Loyalty. The

findings of this study show that Customer Relationship Management has a positive impact on

customer satisfaction, Service Quality has a positive impact on customer loyalty, Customer

Value also has a positive impact on customer loyalty, Customer Relationship Management has

a positive impact on customer loyalty, and customer satisfaction has a positive impact on

customer loyalty.

CONCLUSION

Based on the findings that have been revealed in this study, conclusions that can be drawn

Findings from the study confirm that the First Hypothesis, namely the variable of Service

Quality has a positive and significant influence on Business Process Improvement. Quality of

service by providing tangible evidence, responsiveness by providing services to customers

quickly and responsively; Assurance, Empathy, and Reliability implemented by Bank BTN

Regional Office 2 (DKI and Banten) to Non-Program Small Medium Enterprise (SME) credit

customers can improve service quality so that it is proven to affect improving business

processes. The results prove that the Second Hypothesis, namely the Trust variable has a

positive and significant influence on Business Process Improvement. Bank BTN Regional

Increased Customer Loyalty: The Role Of Service Quality, Trust,

Satisfaction, And Business Process Improvement As Mediation

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Office 2 (DKI and Banten) provides trusting beliefs by serving customer needs on an ongoing

basis; maintaining, and fulfilling agreements made with customers; and being able to meet

customer needs, and customers are willing to accept risks or negative consequences that may

occur and are willing Provide information, follow suggestions or requests, to prove trust affects

business process improvement.

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ST Prijono Budi Tjahjono

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(2023)

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