The Influence of Information Service Quality on Risk Behaviour towards Investment Decisions in The Banking SectorThe Influence of 

by Reda Abdullah Aburas


In view of intense competition, the banking sector strives to improve its service quality. The importance of this issue stems from its implications to enhance service quality leading to acquiring customers and gaining better profitability. One of the critical aspects of quality in the banking sector is the information service quality. Information is an important asset to any organization. Information quality in the business environment refers to the characteristics of the presented information.

These characteristics include measures such as accuracy, relevancy, comprehensiveness, timeliness, and preciseness of the information provided. It is imperative that banks provide only the necessary information required by the customers so that the appropriate decision, particularly in relations to an investment decision, may be made according to the set requirements by the customers. However, in Libya there is a clear weakness in the quality of information services provided to the customers due to the utilization of traditional methods and practice. The information service produced is of poor quality.

This has caused low customer confidence in the information provided by the Libyan commercial banks that in turn has affected the customer’s investment. Therefore, the main purpose of this study is to examine the relationship between information service quality (ISQ), risk behaviour and investment decision. Data for this research were collected through a questionnaire survey administered to the customers of banks in major cities of Libya.

Data were analysed using statistical techniques namely, descriptive and modelling the relationships of the studied variables using Structural Equation Modelling (SEM). The results from this study revealed that the significant ISQ domains were Accessibility, Intrinsic, Contextual and Representational, with accessibility having the highest influence on ISQ, followed by intrinsic, context and representational addition, the findings showed there was a direct influence of ISQ on the investment decision.

The  present study confirmed the significant interaction between the ISQ as the independent variable, risk behavior the mediating variable and investment decision as the dependent variable. Finally, the present study confirmed that there is significant relationship between customers’ emographic characteristics and investment decision in Libyan banking sector. This research contributes to knowledge in several ways. With the limited number of literature related to the ISQ< in banking sector in Libya as well as the relationships between ISQ, risk behaviour and investment decision, this study fulfilled the existing gaps in the literature.

The present study has successfully developed a model which provides the framework of information service quality which influence customers’ investment decision. The model may be useful to the banks management team in designing the appropriate information services deployment that would effectively lead to an increase in customers’ confidence level, hence influence investment decision.

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