The Central Bank of Oman published an overview of the new Banking Law and the Central Bank of Oman Statute, promulgated by Royal Decree No. 2/2025 and Royal Decree No. 3/2025, updating the legislative framework for central bank governance and the regulation of banking and non-banking financial activities in Oman. The package includes provisions to allow foreign banks to operate in the Sultanate of Oman, establishes a dedicated framework for Islamic banking, and provides for new models such as digital banks and financial technology services alongside enhanced customer protection. The Banking Law comprises 241 articles and, among other areas, sets out CBO responsibilities, finances and operating mechanisms including monetary policy implementation and liquidity management, and reserves the issuance of national currency to CBO, allowing it to update currency forms and techniques. It provides a legislative basis for licensed banks’ investment and credit activities, including support for small and medium-sized enterprises, and includes Islamic banking provisions intended to avoid double taxation on real estate and movable property when transactions are conducted in accordance with Islamic banking principles. The law also addresses digital crowdfunding platforms, open banking applications and other technology-based services, with relaxations on regulatory requirements for these activities, and highlights expectations on transparency, fairness, service and price disclosure, and data protection and privacy. The Central Bank of Oman Statute comprises 21 articles defining CBO’s objectives and functions, including issuing the national currency and maintaining its value, setting and implementing monetary policy, and supervising licensed banking and financial activities. The central bank noted that the legislation follows the Bank Deposits Protection Law issued under Royal Decree No. 47/2024 and was accompanied by royal decrees forming a new CBO Board of Directors and appointing its Governor.
Central Bank of Oman 2025-03-18
Central Bank of Oman outlines new Banking Law and central bank statute covering foreign banks, Islamic banking and fintech
The Central Bank of Oman released an overview of the new Banking Law and Central Bank of Oman Statute, enacted by Royal Decrees No. 2/2025 and No. 3/2025, updating governance and regulation of financial activities. Key provisions include allowing foreign banks, establishing Islamic banking, and introducing digital banks and fintech services. The legislation also addresses digital crowdfunding, open banking, and emphasizes transparency, fairness, and data protection.