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Cashless transaction gathering steam: CBO

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More people are resorting to cashless transactions such as account-to-account transfers via mobile or the Internet, boosting government initiatives to achieve digital transformation in the Sultanate of Oman.

Online retail transactions (direct credit & direct debit) exponentially increased by 37.8 per cent in 2022 from the previous year, reaching 274.4 million from 199.2 million transactions, the Financial Stability Report 2023 of the Central Bank of Oman (CBO) said.

The cheque payments volume has been decreasing- falling below the 5-year average- indicating the move from paper-based to digital alternatives.

Mobile payment usage, however, showed a significant increase of 551 per cent in transactions and 385 per cent in value. Accordingly, the volume of e-payment transactions increased by 39.4 per cent in 2022 to 252.9 million transactions compared to 180.8 million transactions in 2021, primarily driven by POS transactions (50.2 per cent), e-commerce (35.5 per cent).

In comparative terms, ATM transactions grew slower (8.75 per cent) compared to cashless transactions during the pandemic to avoid unnecessary cash usage.

The value of transactions executed via retail systems increased by 13.1 per cent from the previous year, reaching a total value of RO 27.3 billion, said the report.

The main driver for this growth has been the rising use of e-payment services.

Digital payment initiatives emerged as a cornerstone during the pandemic to make safer and quicker payments for goods and services, the CBO report said.

The advancement in terms of reach and utilisation of progressive payment systems has been emboldening, highlighting the exponential increase in the volume of transactions processed through the retail payment systems during the years 2021 and 2022.

For example, ACH usage has grown by 25 per cent in both volume and value terms. An ACH bank transfer is an electronic payment made between banks for payment purposes.

The network that these payments occur across is known as an "automated clearing house."

ACH bank transfers are used for many purposes, such as direct deposits of paychecks, debts for regular payments, and money transfers.

Additionally, OmanNet usage increased by nearly 40 per cent in transactions and about 13 per cent in value terms, primarily led by the increase in E-commerce transactions.

The cashless payment scheme has been rolled out in stages in the country, covering shopping malls, cafes and restaurants, commercial centres, and gift markets, among others.


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