Abstract

University students represent an attractive segment of customers for retail banks in many countries including
South Africa. The objective of this study was to investigate the determinants of the choice of commercial banks
by university students. University of Fort Hare (Alice campus) was the study area. Data was collected through
self-administered questionnaire. Convenience sampling method was used. For data collection, forty questions
were identified through a review of the literature. Principal component analysis reduced the forty questions to six
factors namely, service, proximity, attractiveness, recommendations, marketing and price. Data was analysed
using descriptive statistics, T-test and ANOVA. The Cronbach’s alpha was used to test the reliability of the
scales. The results showed that the six factors are important factors are important determinants of the choice of
commercial banks. Recommendations included marketing strategies by commercial bank management focused
on different market segments including university students.

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