Oman’s Financial Sector Vulnerable to Cyber-Attacks as Digital Payment Channels Expand

Despite being spared significant cyber attacks in recent years, Oman’s financial sector remains a prime target for hackers and cyber criminals, warns the Central Bank of Oman (CBO).

The Growing Threat

The CBO’s Financial Stability Report 2023 reveals a staggering 46% surge in cyber attacks targeting financial institutions globally last year. This trend underscores the sector’s dominant appeal as a target for international cyber gangs, with hackers seeking huge rewards if their attacks are successful.

Oman’s Vulnerability

While Oman has not experienced any significant disruptions from cyber risks recently, it is still vulnerable to such threats. As such, cybersecurity remains a top strategic priority for the CBO. The warning comes amid an exponential increase in the usage of electronic payment channels and fintech apps for various banking, retail, and e-commerce transactions.

The Rise of Digital Payments

The growth of digital payments has been fueled by the Covid-19 pandemic, with the volume of transactions processed by the CBO’s Payment and Settlement Systems (PSS) increasing by 37.6% to 275.1 million in 2022, compared to 199.9 million in 2021. The aggregate value of these transactions also jumped 15.6% to RO 206.6 billion last year.

Retail Payments

Retail payments made via digital channels also ballooned 37.8% to 274.4 million in 2022, with the corresponding aggregate value increasing 13.1% to RO 27.3 billion. The CBO noted that this surge is driven by a sharp rise in the use of e-payment services.

Response and Preparation

In response to the growing threat of cyber attacks, the CBO has pledged to remain vigilant and proactive in the face of digital risks. A task force has been commissioned to study the introduction of Central Bank Digital Currencies (CBDCs), while separate groups are focused on other digital innovations. The bank’s goal is to equip itself with the expertise required to navigate the evolving landscape of digital finance and stay prepared to take appropriate action when necessary.

New Digital Products

The CBO’s warning comes as it prepares to roll out new digital products, including CBDCs, which will further expand Oman’s fintech landscape. The bank has emphasized that cybersecurity will be a critical component of its digital transformation strategy, ensuring the continued trust of customers in digital financial services and the financial sector as a whole.

Conclusion

Oman’s financial sector remains vulnerable to cyber attacks despite not experiencing significant disruptions recently. As the country continues to aggressively adopt fintech and electronic payment systems, cybersecurity must remain a top strategic priority for the CBO to ensure the continued trust of customers and the stability of the financial sector.