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The Impact of Digital Financial Services on Developing Financial Literacy as an Entry Point for Integrating the Unbanked in Algeria: An Analytical Approach

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DOI:https://doi.org/10.65281/737845

Dr. Mohamed Bouchemal 1, Dr. Hassen Meftah2 , Pr. Chihab ilimi 3  Pr. Abderrahmane Bouchemal 4

1 Ziane Achour University of Djelfa, Algeria .Email: mohbouch1018@gmail.com

2 Mohammed Seddik Ben Yahia University of Jijel, Algeria . Email : h.meftah@univ-jijel.dz

3 MQEMADD Research Laboratory for Quantitative Methods in Economics, Business Administration and Applications for Sustainable Development; Faculty of Economics, Commercial Sciences and Management, Ziane Achour University of  Djelfa , Algeria

Email: c.ilimi@univ-djelfa.dz

4 MQEMADD Research Laboratory for Quantitative Methods in Economics, Business Administration and Applications for Sustainable Development; Faculty of Economics, Commercial Sciences and Management, Ziane Achour University of  Djelfa . Algeria

Email: abderrahmane.bouchemal@univ-djelfa.dz

Received: 11/01/ 2026  ;  Accepted: 05/04/2026 ;  Published: 21/06/2026

Abstract:

     This study aims to analyze the impact of digital financial services on enhancing financial literacy among unbanked populations in Algeria and to highlight their role as a gateway to financial inclusion, It is based on a central research question: to what extent do these services contribute to improving financial awareness, knowledge, and behavior in a way that supports the integration of these groups into the formal financial system,The study adopts a descriptive-analytical approach, combined with an interpretive framework to examine the interactive relationship between digital finance and financial literacy.

     The findings reveal that digital financial services positively influence financial literacy through three main channels: facilitating access to financial information, learning-by-using, and strengthening trust in the financial system. The results also show that financial exclusion in Algeria is not solely due to supply-side constraints but is also linked to internal factors such as low financial literacy and lack of trust, This highlights the need for an integrated approach that combines digitalization with financial education to achieve sustainable financial inclusion.

Keywords: Digital financial services, financial literacy, financial exclusion, fintech, financial inclusion, Algeria

Introduction

Over the past two decades, the global economy has undergone rapid, far‑reaching transformations, most notably the rise of financial digitalization as a strategic pillar for restructuring financial and banking systems at both national and international levels. This shift has generated a broad ecosystem of digital financial services including electronic payments, digital wallets, Fin Tech applications, and other tools that are reshaping the boundaries of financial transactions and expanding access to them. In this context, the financial inclusion of the unbanked has emerged as a highly important role  in national economic policies, particularly in developing countries where rates of banking exclusion remain markedly high.

Algeria represents a relevant case in this regard. World Bank data indicate that a large share of the population remains outside formal banking services, despite efforts in financial digital transformation since the enactment of Law No. 18–05 on e-commerce and the adoption of national plans to develop electronic payment systems. This issue intersects with another key challenge: the level of financial literacy among broad segments of society, which constitutes an internal barrier to using financial services even when physical and technical access is available.

Research Problem

Based on the above, this study revolves around the following central question:
To what extent do digital financial services contribute to developing financial literacy among the unbanked, in a way that enables their integration into Algeria’s formal financial system?

From this main question, several sub‑questions follow:

  • What is meant by digital financial services, and what are their main types and tools in the Algerian context?
  • How is financial literacy defined, and what measurement standards are used according to internationally recognized benchmarks?
  • What is the reality of banking exclusion in Algeria, and how large is the population marginalized from formal financial services?
  • Through which channels do digital services affect financial literacy levels and the decision to join the banking system?

Study Hypotheses

To address the research problem, the study is built on the following hypotheses:

Main hypothesis: Digital financial services positively contribute to developing financial literacy among the unbanked in Algeria, thereby increasing the likelihood of their integration into the formal financial system.

Derived hypotheses:

  • Algeria experiences a high rate of banking exclusion compared with regional and international averages, and low financial literacy is among its most prominent internal causes.
  • The diffusion of digital financial services increases users’ financial awareness and knowledge through learning-by-using mechanisms.
  • Structural and behavioral barriers limit the effectiveness of digital services in enhancing financial literacy in Algeria, most notably digital illiteracy and low trust in the digital financial system.

Importance of the Study

This study has both scientific and practical significance. Scientifically, it contributes to the limited literature on the relationship between financial digitalization and financial literacy, and it seeks to link financial literacy with banking inclusion rather than examining each in isolation. Practically, its findings provide an evidence base for policymakers and regulatory bodies working on digital financial inclusion.

Study Objectives

This study aims to achieve a set of interconnected objectives, most notably:

  • To conceptualize the study’s core notions (digital financial services, financial literacy, banking inclusion) through a rigorous theoretical foundation,
  • To diagnose banking exclusion in Algeria in light of documented quantitative and qualitative indicators,
  • To analyze the channels through which digital financial services influence financial literacy levels,
  • To draw lessons from successful international experiences and formulate recommendations suited to the Algerian context.

Methodology

This study adopts a descriptive–analytical approach, combining critical theoretical discussion with a quantitative perspective based on statistical data published by reliable international institutions such as the World Bank, the Organisation for Economic Co-operation and Development (OECD), and the Bank of Algeria, regarding digital financial services and financial literacy.

1. Conceptual Framework: Digital Financial Services and Financial Literacy

1.1 Digital Financial Services: Concept, Types, and Tools

1.1.1 Definition of Digital Financial Services

Digital financial services refer to the set of financial products and services that are delivered and managed through digital channels, whether by traditional financial institutions or in connection with them. The spread of these services has shifted financial service delivery from a branch-based model to a smart-device-based model (Ozili, 2018, p. 330).

Most academic and institutional definitions converge on three essential components of digital financial services:

  • the presence of a digital channel as the delivery medium,
  • the provision of a financial product or service with real value for the user,
  • accessibility that overcomes traditional geographic and institutional barriers.

In this regard, the World Bank defines digital financial services as “financial services delivered through digital channels, including payments, savings, credit, insurance and investment products” (Demirgüç-Kunt et al., 2022, p. 4).

1.1.2 Types and Tools of Digital Financial Services

Digital financial services take multiple forms depending on the financial function they perform, and they can be classified into four main types:

  • Digital payment and transfer services: including digital wallets, mobile payment applications, and instant money transfer services. This category is the most widespread and fastest-growing in emerging markets. The Global Find ex 2021 report indicates that 40% of adults in developing countries made a digital payment for the first time during the COVID‑19 pandemic (Demirgüç-Kunt et al., 2022, p. 11).
  • Digital savings and credit services: such as mobile-linked savings accounts, digital microfinance loans, and crowdfunding platforms. These services have demonstrated an ability to reach groups excluded from traditional banks due to a lack of collateral or scarce official documentation (Adelaja et al., 2024, p. 429).
  • FinTech applications: applications that combine intelligent algorithms and big data analytics to provide specialized financial services, such as personal budgeting apps, automated investment “robo-advisors,” and digital registration and documentation services. This type is particularly important for strengthening financial literacy because it provides immediate feedback on users’ financial behavior (Kedjar et al., 2024, p. 3).
  • Digital insurance and investment services: including digitally managed insurance policies and app-based securities investment platforms. This is the most mature category in emerging markets such as Algeria, although its growth is accelerating due to the spread of smartphones and the expansion of digital infrastructure.

1.2 The Concept of Financial Literacy

1.2.1 Evolution of the Concept of Financial Literacy

The OECD, in its standard measurement instrument (INFE Toolkit 2022), defines financial literacy as “a combination of awareness, knowledge, skills, attitudes and behaviours necessary to make sound financial decisions and ultimately achieve individual financial well-being” (OECD, 2023, p. 14).

This definition is particularly valuable for research because it includes actual financial behavior as a component of financial literacy not merely the outcomes associated with it making it a dynamic definition suitable for examining how digital services shape an individual’s financial capability over time.

1.2.2 The Three Dimensions of Financial Literacy

According to the OECD/INFE benchmark framework, financial literacy rests on three integrated and interactive dimensions:

  • Financial knowledge: measured by the extent to which individuals understand basic financial concepts such as simple and compound interest, inflation, risk diversification, and the time value of money. The OECD/INFE 2023 survey covering 39 countries indicates that the average financial knowledge score internationally does not exceed 62% of the minimum targeted threshold (OECD, 2023, p. 22).
  • Financial behavior: including regularly saving a portion of income, setting a monthly budget, comparing financial products before choosing among them, and meeting obligations on time. This dimension is considered the most closely related to decisions to join the formal financial system (Lyons et al., 2021, p. 5).
  • Financial attitudes: reflecting an individual’s orientation toward future financial planning versus preference for immediate spending. Grohmann et al. (2018, p. 88) found that a positive long-term planning attitude independently increases the likelihood of owning a bank account, regardless of income level.

1.3 The Interactive Relationship Between Digital Financial Services and Financial Literacy

1.3.1 From a Linear Relationship to an Interactive One

Most studies on financial inclusion have treated financial literacy and digital services in Algeria as two independent variables, each affecting banking inclusion separately. However, the accumulation of research over the period 2017–2024 has revealed a more complex and richer interactive relationship between the two. On the one hand, higher financial literacy increases the likelihood of adopting digital services and using them effectively. On the other hand, digital services themselves foster users’ financial literacy through a learning-by-using mechanism. Thus, a circular interactive relationship is formed in which each variable reinforces the other, rather than preceding it or operating independently of it (Ozili, 2018, p. 334, Grohmann et al., 2018, p. 92).

Ozili (2018, p. 335) adds a critical dimension to this relationship by warning that the interactive dynamic does not always move in the direction of mutual reinforcement. In the absence of adequate digital infrastructure, or where digital illiteracy is high, digital services may become a source of technological exclusion rather than a bridge to financial inclusion. The author refers to this as an “educational bias” in the distribution of digital services.

1.3.2 Channels of Interactive Influence

This interactive relationship manifests through three main channels:

  • Learning by using: Lyons et al. (2021, p. 8) indicate that users of digital wallet services in Sub-Saharan Africa and South Asia showed a tangible improvement in financial behavior indicators (saving and risk management) compared to non-usersclear evidence that daily use of a digital tool generates implicit financial learning.
  • Instant feedback: FinTech applications allow users to see real-time patterns of spending and saving, which enhances financial awareness and encourages behavioral adjustment. Kedjar et al. (2024, p. 5) conclude that such instant feedback narrows the time gap between a financial decision and recognizing its consequences something traditional services often fail to provide.
  • Cognitive mediation: Digital services reduce the cognitive cost of grasping financial concepts through simplified visual interfaces, interactive charts, and short educational modules embedded within applications. Adelaja et al. (2024, p. 431) emphasize that this built-in techno-educational dimension is what distinguishes digital services from their traditional counterparts in terms of their impact on financial literacy.

2. The Reality of Banking Exclusion and the Impact of Digitalization on Financial Literacy in Algeria

2.1 Indicators of Banking Exclusion in Algeria: A Comparative Statistical Reading

2.1.1 The Scale of Banking Exclusion in Algeria According to World Bank Data

The World Bank’s database is widely regarded as the most comprehensive and internationally comparable statistical reference for measuring financial inclusion indicators. According to the fourth edition of this database (Global Findex 2021)based on field surveys covering more than 128,000 adults across over 120 economies worldwidethe share of Algerian adults (aged 15 and above) who own an account at a bank or with a mobile money provider is about 43%. This means that nearly 57% of adultsi.e., more than half of the adult populationremain outside formal financial services (Demirgüç-Kunt et al., 2022, p. 4).

The severity of this figure becomes clearer when Algeria is compared with global averages: in 2021, financial inclusion reached 76% of adults worldwide and 71% in developing countries. Algeria therefore falls below both benchmarks by 33 percentage points relative to the global average and 28 points relative to the developing-country averagegaps that reflect a structural lag (Demirgüç-Kunt et al., 2022, p. 11).

Disaggregated data further reinforce this picture. Among the 57% of unbanked Algerians, almost two-thirds report that they would be unable to use a bank account independently even if one were made availablean indicator of implicit financial illiteracy as an internal barrier that compounds structural constraints (Demirgüç-Kunt et al., 2022, p. 19). Moreover, the share of adults using digital payments does not exceed 18%, far below the regional average for the Middle East and North Africa (40%) (FinDev Gateway, 2021).

2.2 The State of Digital Financial Services in Algeria

2.2.1 Digital Financial Infrastructure

In recent years, Algeria has witnessed noticeable progress in electronic payment infrastructure, though this progress still falls short of what is required for integration into the regional digital financial ecosystem. Official data from GIE Monétique indicate that the number of electronic payment cards in circulation (CIB and Edahabia) exceeded 16.5 million by the end of 2023. Meanwhile, the number of point-of-sale terminals (TPE) increased from 46,263 units in 2022 to 53,191 units by the end of 2023 (GIE Monétique, 2023, cited in Ebourse, 2024).

With respect to mobile payment applications, BaridiMob (operated by Algérie Poste) constitutes the core pillar of Algeria’s digital payment system. In 2023, the service recorded about 39 million transactions with a total value of DZD 28 billion. The number of registered e-commerce merchants reached 510, up from 291 in 2022growth of nearly 75%. Chabani & Chabani (2025, p. 106) note that BaridiMob and Edahabia dominate Algeria’s digital financial landscape in terms of transaction volume and value, reflecting an exceptional model led by the postal institution rather than commercial banks.

However, these figures conceal sharp geographic disparities: most digital infrastructure is concentrated in major urban areas such as Algiers, Oran, and Constantine, while inland and rural regions remain distant from this emerging network. Economists estimate that the share of cash circulating outside official banking channels remains high, suggesting that the transition toward a digital cashless economy is still in a formative stage (Zouaghi et al., 2023).

2.2.2 The Regulatory Framework

The regulatory framework is among the most important determinants that either constrain or stimulate the development of digital financial services in Algeria. Two key regulatory milestones stand out:

  • Law No. 18–05, issued on 10 May 2018 on e-commerce, which for the first time established a legal framework for digital transactions, consumer protection, and the regulation of electronic signatures,
  • The Monetary and Banking Law No. 23–09, issued in June 2023, which represents a major update to the banking system and includes provisions aimed at encouraging FinTech innovation and accelerating the adoption of electronic payments (Africa Business Intelligence, 2024).

Nevertheless, the gap between legislation and actual implementation remains wide. The number of officially licensed FinTech firms in Algeria is still very small, and many operate under “regulatory tolerance” rather than full formal licensing. Chabani & Chabani (2025, p. 108) argue that the absence of a comprehensive, FinTech-specific regulatory framework constitutes a fundamental obstacle to the growth of the sector’s ecosystem in Algeria.

2.3 Level of Financial Literacy among the Unbanked

2.3.1 A Reading of Financial Literacy Levels in Algeria

In the absence of a comprehensive, systematic national survey measuring financial literacy in Algeria according to the OECD/INFE frameworka research gap in its own right it is still possible to rely on a set of available contextual indicators to sketch an approximate picture of the prevailing level. Global Find ex 2021 data indicate that nearly two-thirds of unbanked individuals in Algeria reported that they would not be able to use a bank account independently without assistance an indicator that directly points to weak operational financial capability (Demirgüç-Kunt et al., 2022, p. 19).

In the Algerian context, Zouaghi et al. (2023) confirm that individuals who express an intention to adopt digital financial services tend to display relatively higher levels of financial awareness, which suggests a positive association between financial literacy and willingness to transition toward digital finance. Conversely, a study on financial inclusion in Algeria shows that unbanked groups justify their self-exclusion through three interrelated factors:

  • low income
  • lack of trust in financial institutions and limited knowledge of available financial products (Mustapha et al., 2022, p. 293).

It is also noteworthy that weak financial literacy in Algeria is not a homogeneous phenomenon, rather, it varies significantly across demographic characteristics. The gender gap in bank account ownership reached 18 percentage points in 2021one of the highest gaps in the region reflecting a socio-cultural dimension in the distribution of financial literacy.

Moreover, levels differ between rural and urban areas, and between youth and older cohorts, which calls for targeted financial education policies designed for specific segments rather than a one-size-fits-all intervention package.

2.3.2 The Informal Economy as a Constraining Structural Variable

Banking exclusion in Algeria cannot be understood in isolation from the country’s broader macroeconomic structure, particularly the large size of the informal sector. Multiple economic estimates suggest that the informal economy accounts for roughly 40–50% of non-hydrocarbon GDP, and that the volume of cash circulating outside formal banking channels is very substantial. This structure is intertwined with a deeply rooted social culture of skepticism toward formal financial institutions, creating a “vicious circle” between weak financial literacy and voluntary exclusion from the banking system.

Ozili (2018, p. 336) captures this phenomenon through the concept of “voluntary financial exclusion,” distinguishing it from forced exclusion resulting from lack of supply. A large number of individuals refuse to engage with the formal financial system not because they cannot access it, but because they do not perceive its value or because they do not trust it. This type of exclusion cannot be addressed by digital infrastructure alone, it requires a carefully designed educational intervention that rebuilds trust and enhances financial awareness as a mediating variable.

3. Anticipating the Role of Digital Financial Services in Enhancing Financial Literacy as a Mechanism for Banking Inclusion in Algeria

3.1 Channels Through Which Digital Financial Services Affect Financial Literacy

3.1.1 Access to Financial Information

Digital financial services facilitate access to financial information at near-zero marginal cost, marking a qualitative shift in how financial knowledge is distributed across social groups. Through mobile applications, instant messages, and USSD short codes, individuals can now instantly view their balances, interest rates, credit conditions, and savings information without visiting a bank branch or interacting with a bank employee. Ozili (2018, p. 332) notes that this wide diffusion of financial information through digital channels represents a fundamental transformation in the “financial awareness” dimension, which the OECD considers a primary pillar of financial literacy.

However, access to information does not automatically translate into comprehension and effective use. Grohmann et al. (2018, p. 91) observe that the positive effect of digital services on financial literacy depends heavily on users’ initial baseline level of financial literacy. Those lacking minimum core financial concepts may be unable to convert available digital information into sound financial decisions. This makes parallel rather than subsequent financial education a necessary condition for digitalization to be effective.

3.1.2 Learning by Using

The behavioral channel is the most influential in the empirical literature. Lyons et al. (2021, p. 9) report that regular users of digital wallets and money transfer services show tangible improvements in financial behavior indicators especially regular saving and risk management compared to non-users, after controlling for income and education. This improvement is explained by the repeated financial experiences enabled by digital services, which gradually reinforce positive financial habits through incremental feedback and reinforcement.

Adelaja et al. (2024, p. 432) further add that applications integrating embedded educational modules such as savings prompts, overspending alerts, and product comparisons produce a stronger educational effect than applications limited to purely transactional functions. In their view, digital service design is a critical differentiating variable in determining the extent to which a service contributes to financial literacy.

3.1.3 Building Financial Trust

The attitudinal dimension individuals’ orientation toward future planning constitutes the most difficult point of influence in Algeria, as voluntary exclusion is rooted less in ignorance of products than in a lack of trust in financial institutions. Zouaghi et al. (2023) indicate that individuals willing to use digital financial services are associated with higher levels of institutional trust, making trust-building a precondition for digital acceptance rather than a consequence of it. This causal sequence complicates the pathway to inclusion: digitalization alone will not persuade those who do not trust the formal financial system to join it.

Nevertheless, successful international experiences show that digital services designed in ways consistent with local culture and familiar social practices such as leveraging existing trust networks and local agents can overcome the trust barrier and gradually build social capital in finance (Kedjar et al., 2024, p. 7).

3.2 Toward a Proposed Strategic Framework for Algeria

3.2.1 Principles of the Strategic Framework

The proposed framework is built on three guiding principles derived from theoretical analysis, field diagnosis, and international comparison. First is the principle of “simultaneity rather than sequencing,” meaning that developing financial literacy should proceed in parallel with building digital infrastructure, rather than preceding it or lagging behind it. Second is the principle of context-sensitive design, whereby digital financial services must be adapted to the cultural and social characteristics of target groups rather than copied from ready-made models. Third is the principle of institutional integration, as effective banking inclusion cannot be achieved through the efforts of a single institution, it requires coordinated cooperation among the Bank of Algeria, relevant ministries, the private sector, and civil society organizations.

3.2.2 The Proposed Strategic Framework

The framework can be divided into four pillars:

  • Digital financial education pillar: This pillar aims to raise individuals’ financial awareness before and during their use of digital services by integrating interactive learning modules into applications such as Baridi Mob, alongside launching simplified digital awareness campaigns across multiple media. This approach can be strengthened by embedding financial literacy into school curricula and developing targeted e-learning platforms, thereby building a sustainable knowledge base across groups, particularly youth.
  • Infrastructure pillar: This pillar focuses on expanding access to digital financial services especially in rural and remote areas by extending the network of electronic payment terminals (TPE) and encouraging the spread of banking agents. It also requires improving internet coverage and promoting mobile payments, in addition to encouraging partnerships between banks and telecom operators to ensure a technical environment supportive of financial innovation.
  • Regulatory framework pillar: The goal here is to develop a flexible and secure legal environment that keeps pace with digital transformation by activating relevant laws and creating mechanisms such as a regulatory sandbox to test innovative financial solutions, while also accelerating licensing procedures for startups. This framework should be reinforced by stronger financial consumer protection and more developed cybersecurity legislation to enhance trust in digital services.
  • Social inclusion pillar: This pillar addresses reducing existing gaps whether gender-based or rural–urban through programs targeting rural women and integrating financial education in schools. It can be broadened by supporting small projects, implementing on-the-ground awareness campaigns, and developing financial products tailored to vulnerable groups such as youth and workers in the informal sector.

3.2.3 Phases for Implementing the Proposed Strategic Framework

A three-dimensional phased pathway is proposed:

  • Embedding financial literacy into the design of digital services: It is proposed that the Bank of Algeria and regulatory authorities require licensed digital financial service providers to integrate embedded financial education content within their applications, including short modules on saving, budgeting, and comparing financial products. India’s Jan Dhan experience suggests that linking financial education to the actual service rather than relying solely on prior training significantly increases comprehension and knowledge retention (EY India, 2024, p. 5).
  • Launching a national program for digital financial literacy: It is proposed that the Algerian government launch a national digital financial education program targeting the most financially vulnerable groups (rural women, youth, informal-sector workers), based on the OECD/INFE 2024 standard framework for measuring digital financial literacy. The program should meet three conditions: it should be designed in local Algerian Arabic (Darija) rather than academic language, it should be delivered through channels that people already use in practice, such as BaridiMob, rather than only through newly created platforms, and its impact should be evaluated periodically using internationally comparable OECD/INFE indicators (OECD, 2024, p. 7).
  • Activating a supportive legal FinTech environment: It is proposed to accelerate the implementation of the provisions of Banking Law 23–09 related to Fin Tech, and to establish a regulatory sandbox enabling startups to test services in a supervised environment before receiving full licensing similar to models adopted in the United Kingdom, the UAE, and several African countries. Such a framework can help attract specialized FinTech firms focused on digital financial education (EdFinTech), which could complement the efforts of the Bank of Algeria (Africa Business Intelligence, 2024).
  • Measuring impact using an international methodology: It is proposed that the Bank of Algeria join the OECD/INFE international network and conduct a periodic national survey to measure financial literacy using the 2024 international standard toolkit, enabling Algeria to benchmark itself against neighboring countries and participate in the next standardized round scheduled under the Toolkit 2026. This would provide the data necessary to assess the extent to which financial digitalization programs influence financial literacy using an objective and verifiable methodology (OECD, 2026, p. 4).

Conclusion

This study set out from a central research problem concerning the extent to which digital financial services contribute to the development of financial literacy among unbanked groups in Algeria, given that financial literacy constitutes a decisive entry point for integrating these groups into the formal financial system. The analytical approach initially considered financial literacy and digital services as two independent variables, each exerting a separate effect on banking inclusion. However, the study ultimately demonstrated the existence of a circular, interactive relationship in which each variable reinforces the other, together forming a key link in the chain of sustainable financial inclusion.

A. Hypotheses Testing

  • The main hypothesis was confirmed: digital financial services contribute positively to improving financial literacy among unbanked groups. However, this effect is conditional upon service design, the quality of digital infrastructure, and users’ baseline literacy levels.
  • The first sub-hypothesis was numerically confirmed: 57% of Algerian adults remain outside the banking system, and two-thirds of them are unable to use an account independently.
  • The second sub-hypothesis was supported by empirical evidence regarding the learning-by-using mechanism.
  • The third sub-hypothesis was clearly confirmed in Algeria through the structural, behavioral, and legal barriers documented in the second section of the study.

B. Findings

The study reached several key findings, most notably:

  • Digital financial services contribute to financial literacy through three complementary channels:
    1. a cognitive channel related to access to financial information
    2. a behavioral channel based on learning by using, and
    3. an attitudinal channel associated with building trust in the formal financial system.
  • Statistical evidence shows that 57% of Algerian adults remain excluded from formal financial services. This exclusion does not reflect shortcomings in supply alone, it is also intertwined with self-exclusion linked to weak financial literacy, low institutional trust, and the dominance of cash outside formal channels.
  • The educational impact of digital services does not materialize automatically once services become available, rather, it depends on the quality of service design and the extent to which digital solutions incorporate embedded financial education content. The Jan Dhan model which combined account opening, financial education, and complementary products achieved deeper qualitative inclusion than models that focused mainly on the technical dimension.
  • Algeria still lacks a comprehensive national survey measuring financial literacy according to the OECD/INFE framework. In addition, there is a scarcity of analytical studies that explicitly connect the conceptual triad of digital financial services, financial literacy, and banking inclusion in the Algerian context.

C. Recommendations

This study recommends the following:

  • Require digital financial service providers to integrate embedded financial education modules within their applications, based on standards set by the Bank of Algeria and aligned with the OECD/INFE digital financial literacy instrument.
  • Launch a national digital financial literacy program targeting the most vulnerable groups (rural women, youth, and informal-sector workers), to be delivered through widely used existing platforms such as Baridi Mob, and evaluated using an internationally comparable methodology.
  • Accelerate the issuance and enforcement of implementing regulations for the Monetary and Banking Law 23–09.
  • Support Algeria’s accession to the OECD/INFE network and conduct the first comprehensive national survey measuring financial literacy using the Toolkit 2026, in order to establish the statistical baseline needed for policy design and evaluation.

References

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