As a result of globalization and international competition, reduced profit margins made it difficult for companies whether they are in physical or service sector. Parallel to this, customer oriented production became the key of success for companies. In other words, it is not possible for companies not being able to meet consumer needs and wants to compete efficiently. Therefore, the measurement of service quality depends to what extent the customer expectations are met. In this respect, this study aims to measure service quality of commercial banks towards Small and Medium Sized Enterprises (SMEs) in Northern Cyprus using SERVQUAL model developed by Parasuraman, Zeithaml and Berry. As a brief summary of the study, commercial banks in Northern Cyprus have not met the service expectations of SMEs for all dimensions. Among the dimensions of service quality highest negative gap belongs to empathy. Furthermore, Relative importance (weights) of quality dimensions stated by SMEs is highest for reliability