Muscat – The Central Bank of Oman (CBO) has issued a regulation governing the practice of the ‘Buy Now, Pay Later’ (BNPL) service. The move forms part of the CBO’s ongoing efforts to develop regulatory frameworks and keep pace with rapid developments in the financial sector.
This step reflects the central bank’s commitment to organising the service and establishing the necessary controls and procedures to ensure it is conducted in a disciplined and transparent manner.
The ‘Buy Now, Pay Later’ service is regarded as one of the modern financing models that enables consumers to purchase goods or services immediately, with payment made in instalments over a later period in accordance with pre-agreed terms and conditions.
With the increasing adoption of the BNPL model, the need for a clear regulatory framework has become essential to ensure a balance between fostering financial innovation, protecting beneficiaries’ rights, and promoting financial stability.
The provisions of the regulation apply to institutions licensed by the Central Bank of Oman to provide this service. It also sets out licensing requirements and procedures, capital adequacy requirements, disclosure and transparency standards, risk management mechanisms, and obligations related to consumer protection.
BNPL is a short-term financing arrangement that allows consumers to split the cost of a purchase into smaller instalments, often interest-free, over a fixed period. The service is typically offered at the point of sale – both in stores and online – and has gained popularity in recent years as digital payments and e-commerce have expanded.
The issuance of this regulation reaffirms the Central Bank of Oman’s commitment to overseeing emerging financial services within clear and advanced supervisory frameworks, thereby enhancing confidence in the financial sector, supporting the growth of digital financial services, and aligning with the economic development objectives of the Sultanate of Oman.
