Pricing Psychology Techniques in Nigerian Retail Banking: Management Application and Customer Response

This study examines the application of pricing psychology techniques in Nigerian retail banking and the resulting customer behavioural responses, with a focus on banks operating in Port Harcourt, Rivers State, South South Nigeria, and Enugu State, South East Nigeria. Pricing psychology, encompassing strategies such as charm pricing, price anchoring, bundling, and fee transparency manipulation, is a management tool with significant customer perception and satisfaction implications in financial services contexts. The research employs a descriptive mixed-method design, with 110 bank marketing and pricing managers participating in structured interviews and 200 retail banking customers completing questionnaires. Manager data are analysed thematically, while customer data are processed using descriptive statistics and regression analysis. The study evaluates how different pricing psychological approaches influence customer perception of value, fairness, and loyalty. Preliminary findings suggest that fee bundling and transparent fee communication significantly improve customer-perceived value in retail banking, while opaque or complex fee structures generate dissatisfaction and switching intentions. Psychological pricing approaches involving prominently featured interest rate displays are found to be highly effective in customer acquisition for savings products. Recommendations address retail bank marketing and product management teams on designing pricing structures that balance revenue optimisation with customer perception management. Keywords: pricing psychology, retail banking, customer behaviour, fee management, marketing strategy