Financial Inclusion's Role in Algerian Banks' Competitiveness: Eloued Agencies Evidence

This study addresses the significant research vacuum in emerging markets by investigating how financial inclusion boosts competitiveness in Algerian commercial banks. Algeria has made steps to improve financial access, yet 58% of adults are unbanked, and banks struggle to compete. As an illustrative case, we study how financial inclusion — access to services, consumption patterns, and service quality — affects banks' competitive standing in El Oued province. Our mixed-methodologies approach combines descriptive, analytical, and statistical methods. 174 standardised questionnaires and branch-level performance measurements were used to collect data from bank clients across several institutions. Using pilot-tested Likert-scale items, the survey instrument assessed all three financial inclusion aspects (Cronbach's α = 0.937). Regression analyses were performed in SPSS 26 to quantify the connections between inclusion factors and competitive advantage indicators. Results indicate a substantial association (p < 0.05) between financial inclusion and competitive advantage, with financial inclusion explaining 40.6% of variance in competitiveness (R² = 0.406). The quality dimension had the most significant impact (β = 0.581), followed by access (β = 0.533) and usage (β = 0.535). Service quality accounted for 33.8% of competitive advantage variance, emphasising its strategic importance. Regional research indicated urban-rural access differences as a significant barrier. Three significant practical consequences of these findings: First, banks should improve service quality to retain customers. Second, rural communities could benefit from focused digital access point expansion. Third, spatially disparate financial inclusion policies should be developed by governments. This study fills a gap in the literature by examining how multiple dimensions of financial inclusion affect the competitive performance of banks in a previously understudied Algerian region. The paper presents empirical evidence for financial inclusion investments in emerging nations and a reproducible methodology for similar circumstances.