When the first Omani traders weighed the Maria Theresa Thaler or dealt in annas and rupees in the markets of Muttrah and Sur, every transaction rested on a single principle: trust. The coin was more than a medium of exchange — it was a contract. Its weight assured value; its design declared legitimacy.
Centuries later, the Sultanate of Oman stands at another turning point. Money now travels not through hands but through code; markets no longer gather only in souqs but on digital platforms. Yet the essence remains unchanged: financial systems exist to sustain trust. And that trust today is governed not by metal, but by regulation and algorithm.
The non-banking financial sector (NBF) — including insurance, capital markets, and a new wave of fintech innovators—has become the backbone of this modern trust architecture. In Oman, the sector’s evolution mirrors the country’s broader transformation from a maritime trading hub to a diversified, knowledge-based economy envisioned in Oman Vision 2040.
At the heart of this transformation lies the Financial Services Authority (FSA). Its unifying mandate — to oversee securities, insurance, and the accounting and audit profession — has done more than streamline supervision. It has provided Oman with a coherent framework to balance innovation with prudence and to embed global standards of governance within local institutions.
The transition from coinage to algorithm is not simply technological; it is ethical and institutional. Where the ancient mint guaranteed value through the purity of metal, the modern regulator guarantees it through the integrity of data and the fairness of rules. The FSA, much like the mint of old, must certify what counts as genuine — only now the verification occurs in bits and ledgers, not alloys.
This shift demands a new concept of governance — one that combines digital frameworks with human oversight. As research on AI governance in the GCC notes, ‘soft regulation’ can spur innovation, but without firm legal grounding and institutional accountability, it risks devolving into ethics-washing. Oman must therefore lean into binding standards for algorithmic fairness, cybersecurity readiness, and data governance — not merely aspirational principles.
Traditional corporate governance — focused on boards, audits, and disclosure — is being joined by digital governance, where regulators supervise data flows, cybersecurity, and artificial intelligence. In Oman, the FSA’s collaboration with the Central Bank of Oman (CBO) on fintech sandboxes and virtual asset frameworks illustrates this evolution in action: the rule-maker becomes an enabler, guiding innovation within transparent boundaries.
Good regulation is not about control for its own sake; it is about ensuring fairness, stability, and accountability—the same values that once made coins credible. The FSA’s embrace of international benchmarks such as the IOSCO Principles, IAIS Insurance Core Principles, and the OECD/G20 Principles of Corporate Governance reflects a conscious effort to anchor Oman’s markets in globally recognised norms.
Yet the more profound challenge lies in the intangible: how to preserve human judgement in an increasingly algorithmic system. Algorithms may execute trades or assess risk in milliseconds, but they cannot embody the moral dimension of trust. Oman’s own financial ecosystem is already moving in this direction. The fintech sandbox launched by the FSA and the CBO in 2024 enables real-world testing of AI-driven lending, digital credit scoring, and risk monitoring.
To stay ahead, the regulators must institute a dedicated AI governance unit, require algorithmic audit logs, ensure traceability in automated decision-making, and invest in continuous training for their own staff. The role of the regulators must evolve — from enforcer of rules to steward of integrity — ensuring that efficiency never eclipses ethics.
As the non-banking financial sector expands, it faces urgent tests: digital literacy, data protection, financial inclusion, and market depth. The solutions will not come from technology alone. They will come from governance that sees technology as a tool — not a master. The work of financial regulators, such as the FSA, on AI-assisted supervision marks a crucial step toward this balance, fusing innovation with responsibility.
Oman’s journey from Sultan Fayṣal bin Turki’s copper anna of 1898 to the digital rial of today is not a leap from past to future but a continuum of trust. The anna linked Muscat’s merchants to those along the rim of the Indian Ocean; the algorithm links Muscat’s markets to global finance. Both depend on confidence that the value is real and oversight is fair.
In that sense, the story of the non-banking financial sector is the story of Oman itself: adaptive, open to the world, yet anchored in principle. If governance was once stamped in metal, it is now written in code—but the imprint of accountability must remain just as visible.
As the world debates the ethics of artificial intelligence and digital money, Oman offers a quietly compelling lesson: progress does not erase tradition—it digitises it. And in the realm of finance, as in life, the true currency is not coin or code, but trust well-governed.
Ahmed al Mukhaini
The author is a policy analyst
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