Bahrain - Digital transactions in Bahrain have surged, with the volume of point of sale (POS) transactions jumping by a significant 22.8 per cent year-on-year to hit $217.9 million between January and October 2025.

This rise in digital adoption formed a key backdrop to the Central Bank of Bahrain’s (CBB) board meeting held yesterday, which saw the approval of a technology-focused budget for 2026.

The fifth CBB board of directors meeting for the year, chaired by Hassan Al Jalahma, focused heavily on leveraging digital tools to maintain the stability and efficiency of the financial sector.

The approved 2026 budget specifically channels resources into strategic digital projects, including the Payment Systems Modernisation Project and new Supervision Technology (SupTech) initiatives.

Additionally, the CBB confirmed its commitment to developing local talent by continuing to invest in human capital through specialised training programmes focused on digital transformation and Artificial Intelligence (AI) competencies.

The chairman extended congratulations to His Majesty King Hamad and His Royal Highness Prince Salman bin Hamad Al Khalifa, Crown Prince and Prime Minister, and the people of Bahrain on the occasion of the kingdom’s celebration of its National Holidays.

The board reviewed key monetary and banking indicators for the period up to October 2025, revealing continued strength and resilience across the financial system.

The outstanding balance of total loans and credit facilities extended to resident economic sectors increased by a solid 6pc compared to October 2024, reaching BD12.8 billion.

Of this total, the personal sector accounted for 48.2pc while the business sector represented 40.6pc of the credit facilities.

Total private deposits also saw a modest increase of 0.8pc, climbing to BD13.6bn. Overall, the balance sheet of the entire banking system – encompassing both retail and wholesale sectors – expanded to $252.5bn, reflecting a 1.8pc increase year-on-year.

The money supply, conversely, recorded a slight decrease of BD0.5bn to BD16bn. The review of digital payment trends showed consumers are increasingly preferring cashless methods. Not only did the volume of POS transactions increase by 22.8pc, but 77.8pc of these 217.9m transactions were contactless.

In value terms, POS transactions totalled BD4.3bn, a 13.1pc increase over the same period in 2024, with contactless payments accounting for 51.8pc of the value. Furthermore, the banking sector maintained its robust capitalisation, with the capital adequacy ratio reaching 20.9pc in Q3 2025, up from 20.5pc in Q3 2024. The ratio stood at 29.7pc for conventional retail banks and 25.2pc for Islamic retail banks.

The collective investment sector also saw moderate growth, with the total number of registered Collective Investment Undertakings (CIUs) reaching 1,750 as of September 2025. Notably, the net asset value (NAV) of Sharia-compliant CIUs surged by a significant 14.76pc to $2.185bn in Q3 2025.

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