Beyond the algorithm: how digital literacy and trust moderate the impact of chatbot quality on customer satisfaction in Egyptian banking

Abstract
This study investigates the direct and conditional effects of chatbot service quality on customer satisfaction in the Egyptian banking sector. It examines how digital literacy and trust moderate this relationship in an emerging market context characterized by heterogeneous technological readiness. Utilizing a structured questionnaire to collect data between January and August 2025 from 422 Egyptian bank customers who engaged with chatbots in the preceding six months. Hypotheses were tested using hierarchical regression and structural equation modeling (SEM). The results reveal that chatbot service quality significantly enhances customer satisfaction. Crucially, both digital literacy and trust act as positive moderators; the impact of service quality on satisfaction is amplified among users who are digitally literate and trusting. The model explains 57% of the variance in satisfaction. So; Egyptian banks should therefore adopt a dual strategy to enhance the customer-experience returns of chatbot deployment: simultaneously enhancing technical quality while implementing targeted digital literacy programs and trust-building campaigns. The evidence indicates that high-quality AI alone is insufficient when users lack digital confidence or trust. Banks should segment customers, offering simplified interfaces for novices and advanced features for tech-savvy users. Transparent communication about data protection and chatbot limitations is essential. This human-centered approach bridges Egypt’s digital divide, ensuring inclusive digital transformation that drives genuine customer satisfaction across diverse user segments. This study bridges the system-centric SERVQUAL model with the user-centric technology acceptance model (TAM). It offers unique empirical evidence from an emerging market, demonstrating that high-quality AI is insufficient for satisfaction without the concurrent development of user capabilities and institutional trust.