Digital Transformation in Iraqi Banks: Current Challenges and Future Development Prospects for the Period (2020-2024(

Abstract

The study discusses the state of digital transformation in the Iraqi banking sector for the period between 2020 and 2024, noting the achievement of significant progress in adopting digital services. This was demonstrated through the growth in the number of active bank accounts and the increase in transactions via electronic payment methods, driven by initiatives launched by the Central Bank of Iraq and changes in customer consumption patterns. Despite this progress, the transformation process faces major challenges that threaten its sustainability. These challenges include high cybersecurity risks, weak infrastructure, and a shortage of qualified competencies. Furthermore, data reveals a gap between the rapid expansion of digital services and the decline in the digital financial stability index, signalling the emergence of additional risks in the near future. In conclusion, despite the ambitious goals of achieving broader digital financial inclusion in the future, the success of this vision remains contingent on addressing structural challenges. This includes enhancing cybersecurity protection, increasing investment in infrastructure and human resource development, and preparing a regulatory environment that supports sustainability.