Despite efforts by Microfinance Institutions in Uganda to use a number of strategies to improve service quality through establishment of networked branches across the country, customer care services like; introduction of comfortable seats in banking halls, ATM, and mobile banking; customers continue to complain about quality of service in some parts of the country.
The customers’ numbers have notably declined in 2005 to 2017 due to poor services offered. This has led to customer dissatisfaction in terms of few customer referrals, low customer retention rates and low customer trust and commitment. The study adopted a cross sectional, descriptive, and analytical research design to gather qualitative and quantitative data. The study population was 110, from which a sample of 86 respondents was randomly selected. Self -administered semistructured questionnaires were used. Results revealed some strong positive associative significant relationships with customer satisfaction for the three aspects; service reliability, service responsiveness and service empathy: service reliability and customer satisfaction was r=0.799***; P=0.0; Adjusted R Square=0.633; service responsiveness and customer satisfaction was r=0.745***; p=0.000; Adjusted R Square=0.546; service empathy and customer satisfaction was r=0.815; p=0.000; Adjusted R square=0.660).

Qualitative data revealed that there existed gaps of; Services not offered on time, communication to customers is not effective and customer complaints are often not addressed. In conclusion, service quality is a predicator of customer satisfaction. When quality is ensured, it brings a sense of achievement for the institution and marginal increase in service delivery. Emphasis should be on communication, feedback, monitoring of services offered by the staff to ensure effective responses to customer needs and demands on order to enhance customer satisfaction.