ABSTRACT Traditional banks provide intermediary financial service by connecting with people under using operative efficiency and creating appropriate credit. However, in recent years, the financial industry in Taiwan suffered from more and more competitiveness, which resulted from unrestricting and internationalization and building financial center in Asia by Taiwan government, so the banks gain less and less profits. At the same time, because of the development of information technology and use of internet, every bank starts to setup its own homepage to provide internet service and gain the advantages of unlimited time, area, fewer cost and more customers from internet bank. The service quality is an important weapon for banks to compete. Although the form of Internet service is different from the traditional service, service quality is still the core competitiveness of the Internet bank. This study mainly investigated national banking website to realize their service functions. The basic structure accorded to the dimensions of SERVQUAL scale in service quality and integrated several traditional measuring factors of banking and modern references of Internet service quality. It also analyzed the relationships among service quality, user satisfaction and user loyalty that can strengthen the concept that increase service quality that also arouse competitiveness of banks. This study though practical research developed five dimensions of the scale, which included good image and assurance, reliability and convenience, price, empathy and customization, and the design of servicing system. After study process we can find: the reliability and convenience have the most affection in whole service quality and satisfaction. Otherwise, we can prove that good service quality will induce customers to raise their satisfaction and increase their loyalty. We can predict that service quality of Internet will be the usable weapon for bank to maintain customer loyalty after allowing setup the virtual Internet bank.