The Impact of Digital Transformation on the Performance of Commercial Banks in Promoting Financial Inclusion: An Applied Study on a Sample of Private Commercial Banks in Iraq "2016–2024"

Abstract

This study aims to clarify the impact of digital transformation (or banking digitization) on the performance of Iraqi private commercial banks and to understand the relationship between these two variables in promoting financial inclusion. This is achieved through evaluating the financial performance of the banks in the study sample for the period (2016-2024). Financial performance indicators were used to answer the research question, which centered on the extent to which digital transformation contributes to improving the performance of the banks in the study sample. To address this question, we adopted a descriptive approach and a quantitative financial analysis methodology to analyze the financial statements of the banks under study. The study reached several conclusions, most notably that the degree of technology used in Iraqi private banks is increasing at a steady pace. Therefore, the digital transformation of information sources is one of the most important contemporary issues that has emerged as a result of the information and communications revolution, following significant advancements in computer and telecommunications technologies, the emergence of various types of networks, and electronic publishing with its vast potential. This transformation serves as an effective tool contributing to the shift from traditional paper-based methods to modern digital methods, which in turn has enhanced financial inclusion. Consequently, many countries are striving to improve public services through various forms of financial digitization, aiming to save time, effort, and costs The study concluded with several key findings, most notably: the alignment of digital transformation with bank performance, which is steadily increasing; a statistically significant positive correlation and impact exist between digital transformation and improved bank performance, thus promoting financial inclusion; and digital transformation is considered one of the most important modern trends in developing economic sectors, including the banking sector, thereby developing the financial system and raising financial strength indicators that support banks' financial positions. Furthermore, it facilitates the delivery of banking services to.