Mobile payments outpace ATMs in Oman: CBO Report

Muscat: Oman’s banking landscape is undergoing a significant transformation, with mobile payments rapidly gaining ground and traditional ATMs witnessing a steady decline in usage. According to the Central Bank of Oman (CBO)’s National Payment Systems Annual Report, ATM transactions dropped from 15% in 2022 to just 11% in 2023, signaling a growing shift towards digital payment channels.

As more consumers in Oman embrace electronic banking, mobile wallets and contactless payments via platforms like Apple Pay and Samsung Pay are becoming increasingly popular. These services allow users to make seamless transactions without needing to present physical debit or credit cards, both locally and internationally. Mobile payment adoption has also been spurred by government initiatives promoting cashless transactions, aligning with Oman Vision 2040’s goal of a cashless society.
The surge in mobile payment activity is further reflected in the impressive rise in Mobile Payment Clearing and Switching System (MPCSS) transactions, which skyrocketed from 4.9 million in 2022 to 40 million by the end of 2023. Additionally, the value of funds transferred via this system jumped by RO 1.44 billion, illustrating the growing reliance on mobile technology for financial transactions.
Despite the drop in ATM use, cash machines remain a crucial service, particularly in areas with high economic activity. The number of ATMs across the Sultanate increased by 40 units in 2023, with Muscat leading the way with 565 machines. However, the continued rise of mobile and online banking options is likely to further reduce the demand for ATMs in the coming years.

ATM distribution by region
Muscat leads with 565 ATMs, followed by Al Batinah North (173) and Al Dakhiliyah (144). Other regions such as Al Sharqiyah North (97) and Dhofar (134) maintain substantial ATM networks, ensuring cash access in areas with high economic activity. Smaller regions, like Musandam (17) and Al Wusta (24), also retain coverage but highlight the growing importance of alternative banking solutions for financial inclusion.

The shift to mobile payments is also seen in the growing popularity of Point of Sale (POS) transactions, which climbed from 68% in 2022 to 74% in 2023. Small retailers, once hesitant to adopt card-based payments, are now more open to mobile transfers, recognizing their efficiency and reliability.

In response to these changing trends, the CBO and local financial institutions are focusing on enhancing financial literacy and promoting digital banking tools, ensuring a smooth transition towards a more connected and cashless economy.