Iraq faces a major challenge in its financial system. Less than 20% of Iraq’s population owns a bank account. This rate remains very low compared to Saudi Arabia’s 54% and the UAE’s 69%. To close this gap, Iraq pushes hard to expand Iraq digital payments across the country.
The Iraqi government and financial sector have embraced digital payments. They recorded over two trillion Iraqi dinars in e-payment transactions recently. This growing move toward digital-first payments aims to boost financial inclusion and power economic growth in Iraq.
For years, Iraq has struggled with outdated banking systems. Many Iraqis rely on informal financial methods because they cannot access modern banking services. This lack of access lowers savings and increases financial risks for individuals and businesses. Moreover, old regulations have slowed the adoption of new financial technology, including cloud-based solutions. Traditional banking infrastructure also complicates the introduction of faster, more secure digital payments.
Replacing old systems offers many benefits. Financial institutions can speed up transactions and improve fraud prevention. They can also offer more services that meet international standards. Recognizing this, Iraq’s Ministry of Planning and the Central Bank of Iraq (CBI) recently required banks to upgrade their digital and technical systems. These upgrades focus on anti-fraud measures, anti-money laundering, and cybersecurity.
The CBI supports digital financial services, Iraq digital payments especially for young people who use smartphones more often. This shift will help younger Iraqis rely more on cards and digital payments instead of cash. Additionally, the CBI has increased licenses for Payment Service Providers (PSPs) and introduced digital banking licenses. These steps push Iraq toward a digital-first economy.
In summary, Iraq digital payments serve as a key driver for transforming the country’s financial infrastructure. This change helps expand access to banking services, encourages economic growth, and improves payment security across Iraq.