The Central Bank of Oman (CBO) has issued a regulatory framework for the licensing and supervision of digital banks, marking a major step toward modernising the country’s financial sector. The framework, which came into effect on June 1, 2025, is aligned with Oman Vision 2040.

The framework allows digital banks to operate as either locally incorporated joint-stock companies (SAOC or SAOG) or as branches of foreign banks, subject to regulatory approval in their home jurisdictions. Two types of licenses will be offered. Category 1 requires a minimum paid-up capital of RO30mn and allows full operations. Category 2 requires RO10mn but comes with business limitations, including caps on customer deposits and corporate lending, and a prohibition on proprietary trading. These limits are waived during the first two years of operation.

All digital banks must maintain a physical head or registered office in Oman. They may open administrative offices for customer support, but not traditional branches for transactions.

Shareholding limits apply: individuals and their affiliates may hold up to 15 percent of voting shares; corporate bodies up to 25 percent; and holding companies up to 35 percent. Cross-ownership in multiple banks is restricted to 15 percent.

Applicants must present a detailed five-year business plan covering digital services, target segments, profitability projections, and a financial inclusion strategy. The plan must outline IT architecture, cybersecurity readiness, and disaster recovery procedures. Digital banks are expected to adopt modern technologies such as AI, open banking, blockchain, and cloud computing. Omanisation targets start at 50 percent and rise to 90 per cent by year five.

The CBO mandates the submission of an exit plan alongside the license application. It must define conditions under which the bank would voluntarily cease operations, such as capital or profitability deterioration. The plan should address customer protection, risk triggers, and exit funding without regulatory assistance.

Licensed digital banks must comply with the Banking Law 02/2025, National Payment Systems Law 08/2018, and AML Law 30/2016. They are also subject to digital onboarding rules, cybersecurity frameworks, consumer protection regulations, and fraud prevention protocols. The CBO may require independent technical assessments at the applicant’s expense.

Non-compliance could trigger enforcement measures, including license revocation. The CBO reserves the right to reject incomplete applications or withdraw approvals if information is found to be inaccurate.