The Central Bank of Oman (CBO) is preparing the groundwork to support linkages between the Real-Time Gross Settlement (RTGS) system – the principal payment platform of the Sultanate of Oman – with the cross-border payment systems of the Gulf Cooperation Council (GCC), as well as the wider Arab region.
The link-ups, when completed before the end of this year, will enable cross-border payments to be effected in local currencies cost-competitively and in real time, according to top officials of the CBO.
“The integration of the CBO’s system with the GCC’s RTGS system (known as AFAQ) is currently in the testing stage, and the integration of Oman’s payment system with the Arab regional payment system (known as BUNA) is also in progress,” said Tahir Salim al Amri, Executive President – CBO.
Speaking at a banking summit held in the city recently, Al Amri said the country’s RTGS system is currently in the final stages of an upgrade. When up and running before the end of this year, it will operate 24x7, enabling payment transactions to be settled in real-time when it is integrated with the AFAQ and BUNA cross-border payment systems.
The Arabian Gulf System for Financial Automated Quick Payment Transfer (AFAQ) was launched last December in response to the directives of the GCC Supreme Council. The mandate for the operation of AFAQ was given to Gulf Payment Company (GPC), a Riyadh entity joined owned and managed by the central banks of the six Gulf states. The AFAQ platform enables banks and other customers across the region to transfer funds in a speedy and secure fashion at a lower transaction cost.
BUNA, on the other hand, is a cross-border payment system owned by the Arab Monetary Fund (AMF) that enables central banks and financial institutions across the Arab region and beyond to send and receive payments in their local currencies in a cost-effective manner. Since its launch, the platform has onboarded a number of local and international currencies, as well as banks and financial institutions.
According to Ali Hamid al Jabri, Manager – Payment Systems, CBO, the modernisation of the RTGS platform will ensure seamless integration with the AFAQ and BUNA cross-border payment systems.
“We are (upgrading) our RTGS to function 24x7 with a link to AFAQ for the processing of payments within the GCC, and the BUNA platform for the Arab region. The 24x7 RTGS will have different features, such as allowing banks to monitor settlements with the CBO in real time, and ensure liquidity is managed in better way.”
Banks are also being encouraged to be onboarded with the BUNA system for cross-border payments within the pan-Arab area, he said, adding that the Central Bank is also working to make the Omani riyal as a settlement currency in the BUNA platform.
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