The Spread of Digital Payments Does Not Necessarily Mean Financial Inclusion Success – Where Is the Real Challenge?
With every new announcement about the growth in payment cards, POS terminals, or electronic wallets, some may assume that Iraq is rapidly approaching full financial inclusion However, the reality is far more complex
Financial inclusion is not simply about owning a payment card It is about people actively using financial services in their daily lives, keeping their money within the financial system, and relying on saving, payment, transfer, and financing tools as a normal part of everyday life
In Iraq, the number of payment cards and electronic wallets has increased significantly in recent years, particularly due to government salary localization programs and the expansion of electronic payment companies Yet many citizens still withdraw their entire salaries within minutes or hours of receiving them
This behavior suggests that the widespread availability of payment tools does not necessarily translate into genuine trust in the financial system
A large portion of economic activity also remains cash-based, whether in traditional markets, small businesses, or even some commercial sectors that possess electronic payment devices but rarely use them
The reasons are numerous, including limited financial literacy, concerns about keeping money in accounts, the absence of certain modern banking services, and the long-standing cultural preference for cash transactions
Despite the progress achieved in recent years, Iraq’s real challenge is no longer issuing more cards, but transforming cardholders into active users of financial services
The success of financial inclusion should not be measured solely by the number of distributed cards, but by the volume of digital transactions, the amount of money retained within the banking system, and the extent to which citizens rely on financial services in their daily lives