Cybersecurity Threats Loom Large for Oman’s Financial Institutions Amid Digital Transformation Boom

As Oman’s financial sector continues its rapid transformation into a digital powerhouse, the Central Bank of Oman (CBO) has sounded a stark warning about the looming threat of cyber-attacks on the country’s banking and financial institutions. Despite having escaped any major disruptions from cyber risks in recent times, the CBO emphasized that Oman’s financial sector remains vulnerable to such threats.

Global Cyber-Attack Surge

According to the apex bank’s Financial Stability Report 2023, a staggering 46% surge in cyber-attacks targeting financial institutions globally was recorded last year. This highlights the dominant appeal of the banking and financial industry as a target for international cyber gangs. The report noted that these attacks could significantly impact customer trust in digital financial services and the entire financial sector.

Oman’s Financial Sector Remains Vulnerable

Oman’s financial sector has been spared any major damage from cyber-attacks so far, but the CBO stressed that cyber-security remains a top strategic priority for the bank. The warning comes amid an exponential growth in the usage of electronic payment channels and fintech apps for various banking, retail, and e-commerce transactions.

Electronic Payment Channels Soar

To meet this soaring demand for e-payment solutions, the Central Bank recently launched its new Real Time Gross Settlement System (RTGS), which enables seamless and around-the-clock processing and settlement of high-value payments. Reflecting the rapid growth in electronic payment options, the volume of transactions processed by the CBO’s Payment and Settlement Systems climbed 37.6% to 275.1 million in 2022.

• Key statistics:
  • Volume of transactions processed by the CBO’s Payment and Settlement Systems: 275.1 million (up 37.6%)
  • Retail payments made via digital channels: 274.4 million (up 37.8%)
  • Aggregate value of these transactions: RO 27.3 billion (up 13.1%)

Proactive Approach to Cybersecurity

In conclusion, the Central Bank pledged to remain vigilant against cyber-attacks even as it explores the roll-out of new digital products, including Central Bank Digital Currencies (CBDCs). A task force has been commissioned to study the introduction of CBDCs, while separate groups are focused on other digital innovations. The proactive approach aims to equip the CBO with the expertise required to navigate the evolving landscape of digital finance and stay prepared to take appropriate action when necessary.