Tuesday 09 / September / 2025
Muscat: The Central Bank of Oman (CBO) launched an electronic system designed to provide Sharia-compliant Rial Omani liquidity management instruments for Islamic Banking Entities in the Sultanate of Oman
The Islamic Liquidity Management products and associated contracts have been reviewed and approved by the High Sharia Supervisory Authority (HSSA) at the Central Bank of Oman, in accordance with regulatory requirements and Sharia principles. Two liquidity provision instruments are introduced at this stage to Islamic Banking Entities (IBEs), namely: Qard Hassan and, Restricted Mudaraba.
The Central Bank of Oman will provide liquidity under the above-mentioned instruments to be utilised by IBEs against their holdings of acceptable Sharia-compliant securities as collaterals. Through Qard Hassan instrument, the Central Bank of Oman will provide liquidity to IBEs during the business day, based on Qard Hassan contract. While via the Restricted Mudaraba instrument, the Central Bank of Oman offers short-term liquidity to the IBEs, for investment in Sharia-compliant transactions.
It is noteworthy that the system also facilitates the issuances of Sharia-compliant Government securities, such as Islamic Treasury Bills, Sukuk, as well as other liquidity absorption instruments which are to be introduced at a later stage.
The newly launched system is considered the first of its kind in the Middle East and North Africa region, as it provides a broad range of Sharia-compliant liquidity management instruments, thus serving both monetary and fiscal policy objectives. The system is fully integrated with other national Financial Market Infrastructure systems, such as the Real Time Gross Settlement (RTGS) as well as Muscat Clearing & Depository systems.
It is important to highlight that the launch of the electronic system marks an important milestone, in continuation of the efforts undertaken by the Central Bank of Oman in providing Sharia-compliant liquidity management instruments to the IBEs, which started with the introduction of the USD Wakala Money Market instrument in December 2022.
