Saturday 22 / November / 2025
Muscat: The Sultanate of Oman is rapidly reshaping its financial and economic reality, driven by a clear government will to transform the financing system, attract investment, and implement intensive legislative and financial reforms.
The banking sector achieved tangible growth, with credit jumping to more than OMR34 billion, and local banks in the Sultanate of Oman attracting increasing deposits that reflect the confidence of the private sector, while digital payment systems recorded record numbers.
With this continuous movement, the Sultanate of Oman is asserting its presence as an emerging economy with a stable and promising financing environment, and is preparing for a broader stage in attracting quality investments in accordance with the objectives of the "Oman 2040" vision.
The sustainability of the state’s financial performance has contributed to consolidating international confidence in the Omani economy. Standard & Poor’s has affirmed the Sultanate of Oman’s credit rating at BBB- with a stable outlook, confirming the strength of the financial position and the government’s ability to manage public debt efficiently.
Moody’s has also raised the Sultanate of Oman’s credit rating to the investment grade of Baa3, reflecting the robustness of the financial position and the decline in the public debt-to-GDP ratio, which enhances the Sultanate of Oman’s ability to attract long-term foreign capital.
On the banking performance side, the latest data showed continued growth in bank credit, with the total credit balance granted by the banking sector in the Sultanate of Oman increasing by 8 percent to reach OMR34.5 billion by the end of September 2025.
Data released by the Central Bank of Oman showed that credit granted to the private sector grew by 5.7 percent to reach OMR28.2 billion by the end of September 2025.
Total deposits in the banking sector grew by 4.7 percent to reach OMR33.1 billion by the end of September 2025. Within this total, private sector deposits in the banking system increased by 7.5 percent to reach OMR22.3 billion by the end of September 2025.
Regarding the distribution of the total private sector deposit base across different sectors, the figures indicate that the personal sector holds the largest share, amounting to about 50 percent, followed by the non-financial corporate sector and the financial corporate sector with shares of 30.5 percent and 17.3 percent respectively. The remaining 2.2 percent was distributed among other sectors, reflecting growing credit activity and a greater flow of liquidity in the banking system.
This growth reflects the confidence of the private sector and individuals in Omani banks, the high demand for financing, and the expansion of non-oil economic sectors.
In addition to traditional banks, the Islamic finance sector has witnessed remarkable growth in the volume of credit and deposits, providing broader financing options for investors, whether in the areas of trade finance or financing assets and small and medium enterprises. The initiatives of Islamic banks and finance companies have contributed to providing innovative products that meet the needs of both local and foreign investors.
Small and medium enterprises (SMEs) accounted for 3.7 percent of the loan portfolio. The Sultanate of Oman, through the Central Bank of Oman, the SME Development Authority, and local banks, is working on implementing a national strategy aimed at raising this percentage to 5 percent, while facilitating credit assessment procedures, reducing collateral requirements, and establishing specialised financing units within banks.
In the legislative context, the Sultanate of Oman is proceeding with updating the legal framework supporting the financial sector. The new Banking Law was issued, which represents a shift in regulating digital banking services, prohibits shell banks, and enhances governance requirements and protection of the financial consumer.
The establishment of the Financial Services Authority also restructured the non-banking financial services sector, including oversight of the Muscat Stock Exchange, the insurance sector, and the accounting and auditing profession.
The Authority launched a comprehensive incentive program for the Muscat Stock Exchange aimed at encouraging family and private companies to transform into public or closed joint-stock companies, and to create a promising companies market to attract small and medium enterprises and startups. The program includes tax incentives and legislative and procedural facilities that encourage listing on the Muscat Stock Exchange and enhance companies’ ability to obtain long-term financing.
His Excellency Abdullah bin Salem Al Salmi, Chairman of the Financial Services Authority, affirmed that the financial stimulus programme aims to encourage companies in general, including family businesses and emerging small and medium enterprises with high growth, to transform into more sustainable companies by adopting appropriate governance standards that ensure their stability and sustainability across generations.
He pointed out that these companies represent the largest percentage of companies operating in the economy, add high value, provide products and services to the local market and for export, employ a workforce, and provide jobs for Omanis.
In a statement to the Oman News Agency, His Excellency said that the incentive programme encourages these companies to move to more sustainable legal forms that are subject to supervision and regulation by the Financial Services Authority and the market in general, as these companies disclose their financial data, which allows investors to learn about the companies, their performance, and the extent of their commitment to governance and disclosure standards and requirements.
His Excellency added that the programme aims to enable these companies, by transforming into the announced legal forms, to engage in the capital market system, which enables them to benefit from the available financing alternatives to use in expanding their operations, achieving the growth they seek, contributing to economic development, and achieving the goals that the government seeks to create a real, diversified, and sustainable economy.
His Excellency pointed out that the capital market is an important financing tool and offers different alternatives that suit the actual needs and circumstances of companies. The most important feature of these alternatives is that they offer medium and long-term financing, unlike the financing provided by the banking sector.
His Excellency affirmed that the programme also aims to position the capital market as a financing tool that contributes to and helps in collecting savings from different segments of society and directing them to finance economic projects of appropriate sizes that contribute to economic development and the realisation of the “Oman 2040” vision, and to increase the size of the market and deepen dealings in it to reach the appropriate sufficiency that enables it to play its role in supporting economic growth and creating wealth.
His Excellency spoke about the importance of the capital market as a complementary tool to the banking sector by providing multiple alternatives represented in capital financing or through bonds, sukuk and others, which provides flexibility that greatly suits the borrower’s need and helps to distribute risks and allow the investor the freedom to enter and exit any investment through the secondary market in the Muscat Stock Exchange.
The Chairman of the Financial Services Authority said that the integrated infrastructure must be provided in terms of the legal and legislative system, the regulatory system, the means of trading in the secondary market and the actors in this aspect, in order for the Sultanate of Oman to be a regional center for green bonds and sukuk.
The Sultanate of Oman is witnessing a tangible expansion in modern financing tools; the volume of financing through crowdfunding platforms since the launch of the first platform in 2022 until the end of the second quarter of 2025 reached about OMR14.9 million; which reflects the increasing role of crowdfunding in supporting startups and small and medium enterprises by providing financing alternatives away from the traditional banking system.
In the field of electronic payments, the Sultanate of Oman has made great progress recently, as the number of mobile payment transactions has increased to about 40 million transactions annually, compared to less than 5 million three years ago, supported by advanced national payment systems that include the Real-Time Gross Settlement System, the Electronic Clearing System, and the mobile payment platform.
This transformation contributes to enhancing business efficiency, reducing reliance on cash, and providing a fast and secure operating environment.
Mustafa Ahmed Salman, a member of the Board of Directors of the Oman Chamber of Commerce and Industry and Chairman of the Chamber’s Finance and Insurance Committee, explained that the government has made efforts to strengthen the financing system, most notably the launch of the Capital Market Stimulus Programme, the strengthening of the Development Bank’s portfolio, the establishment of the Oman Investment Bank as the first specialised investment bank in the Sultanate of Oman to support the strategic goals and ambitions of the Sultanate of Oman and investors locally and regionally, and the launch of the Promising Companies Market to be an innovative financing and investment platform targeting small and medium companies by simplifying listing requirements and providing tax, marketing and operational incentives, which contributes to enhancing the growth and sustainability of these companies, raising the level of their transparency and governance and building trust between them and investors.
He pointed out that the Oman Chamber of Commerce and Industry has aligned its goals and strategic plans with the objectives and priorities of the "Oman 2040" vision to improve the business environment and work with government agencies to enhance the Sultanate of Oman's position as an investment destination capable of attracting foreign direct investments.
The Chamber works to organise trade delegations, forums and economic events inside the Sultanate of Oman and abroad in various brotherly and friendly countries.
He added that the Chamber adopted the strategic approach of expanding the base of economic diversification by working with relevant authorities to attract foreign investments in targeted economic sectors, in addition to partnering in the economic development of the governorates by exploring investment opportunities in the governorates and directing investors to take advantage of those opportunities in partnership with the governors’ offices.
He emphasised that the Finance and Insurance Committee, along with the Foreign Investment Committee and other committees in the Oman Chamber of Commerce and Industry, plays a pivotal role in enhancing the efficiency of the financing system and improving the investment environment, especially for foreign investors.
It also discusses the challenges facing the financial and insurance sectors and submits proposals to the relevant authorities to contribute to the development of legislation and procedures related to facilitating access to financing.
The committee also contributes to raising awareness of financial systems by organising specialised events such as the seminar on arbitration in banking transactions contracts, which aimed to raise the knowledge of investors and companies about mechanisms for resolving financial disputes and ensuring the rights of the parties.
He said that the committee is working to build bridges of cooperation with relevant institutions, including banks, financing institutions, and regulatory bodies, through direct meetings and reviewing challenges, which contributes to providing solutions that enable companies to expand and invest.
The Sultanate of Oman is also developing its financial technology environment through a regulatory sandbox that allows startups to test innovative financial products and services before launching them on the market, in addition to developing an open banking framework that enables technology companies to provide advanced financial services based on the secure sharing of banking data.
The financing system is completed by developing the credit information system, as the Mala’a Center for Financial and Credit Information continues to expand its coverage by integrating comprehensive data on individuals and companies, which enhances the accuracy of credit assessment and provides the foreign investor with a clear information base for making financing and investment decisions.
The Sultanate of Oman enjoys strong competitive advantages, including political stability, a strategic location on international trade routes, and advanced infrastructure in ports and special economic zones, including the Duqm Special Economic Zone, which is a promising logistical and industrial gateway for linking Asian and African markets.
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