Effect Of Non-Monetry Rewards On Employees’ Retention With Mediating Role Of Motivation: A Study Of Banking Sector

Abstract

The research examines how non-monetary incentives affect employee retention through motivation as a mediator in Peshawar Pakistan's banking sector. The research examines two types of non-monetary rewards which are recognition and development opportunities because these elements matter most in the banking sector of Peshawar Pakistan. The study employed a survey-based quantitative approach to gather data from 200 participants who worked in six major banks and received 180 valid responses which were analyzed through SmartPLS SEM. The study demonstrates that development opportunities lead to higher employee motivation and retention rates which makes them essential for successful retention practices. The research results indicated that recognition had no substantial impact on motivation or retention because symbolic appreciation might not be enough to motivate employees in demanding banking roles. The study revealed that motivation served as a leading factor for employee retention and it linked development opportunities to employee retention but failed to establish a connection between recognition and retention. The research supports Herzberg’s Two-Factor Theory by demonstrating that career development acts as a stronger intrinsic motivator than recognition for maintaining long-term employee commitment. The study demonstrates that banks in Peshawar should establish development-focused HR policies and professional growth initiatives because these strategies will boost employee motivation and decrease employee turnover rates.