Muscat: With margins under pressure and global macroeconomic uncertainty persisting, for now, Oman’s most successful banks will likely be those that embrace technology and adopt digital solutions to overcome disruption caused by COVID-19, according to KPMG’s third annual Oman Banking Perspectives report.
The pandemic has underscored a need for tremendous interconnectivity. Many banks are keen to digitalise their customer experience, services and products and expand beyond traditional bricks-and-mortar service models. Yet profound industry challenges remain, driven largely by rapidly evolving customer expectations and increasing regulatory scrutiny.
According to the report, the standing of Omani banks in the international market remains strong, regardless of potential geopolitical uncertainty. The Central Bank of Oman (CBO) announced a comprehensive incentive package to inject additional liquidity of more than OMR8 billion ($20.78 billion) into the economy. However, there are some headwinds: containing costs remains a prime concern in a volatile market as banks face significant top-line pressure on cost-to-income ratios.
Looking to the future, the report notes a renewed focus on open, connected banking, with data leveraged to drive business growth. ‘Banking the ecosystem', where customers can access several services in a single integrated experience, may represent the cornerstone of digital banking in the future – improving customer satisfaction and boosting revenue streams.
As the report notes, banks in Oman are also beginning to embrace blockchain, which offers benefits including operational efficiencies, reduction of intermediary costs and a culture of transparency, without the traditional potential risk of inaccurate information transfer.
“We believe the future is ripe for both growth and transformation,” said Macfarlane. “Banks that effectively leverage their digital assets, bolster cyber resilience and manage third-party risk will likely reap the benefits of increased revenue streams, regulatory compliance and enhanced operational efficiency.”
© Muscat Media Group Provided by SyndiGate Media Inc. (Syndigate.info).