The Impact of Virtual Agents on Customer Loyalty in Major Swedish Banks

Abstract: Abstract Background Since the emergence of digital banking, the financial sector has experienced a significant transformation in both how business is conducted and how services are provided to customers. Previous literature has examined how new technologies and the digitalization of banks' customer service affect customer loyalty. Although, since virtual agents acting as service providers in the banking sector is a relatively new phenomenon, there is limited research concerning the implications it will have on the bank-customer relationship. Hence, the novelty and relevance of the topic makes it interesting for further research.    Purpose Through the identified underlying factors affecting customer loyalty, the purpose of this study is to examine how customer loyalty will be affected by the implementation of virtual agents as service providers in major Swedish banks.   Method This is a qualitative study, and the empirical data were collected from semi-structured in-depth interviews with bankers at four major Swedish banks, as well as with ten highly-educated customers who are frequent users of bank services.   Findings The findings showed that virtual agents must affect customer service to a large extent to have a profound impact on customer loyalty. Virtual agents will be able to replace human bankers regarding simpler inquiries satisfyingly. On the other hand, the demand for personal interactions regarding more complex matters is found to be important.