Oman’s alternative lending sources growing rapidly in supporting SMEs

Muscat — Alternative lending in Oman is expanding rapidly, driven in part by objectives in Oman Vision 2040 and growing demand from startups and small and medium enterprises (SMEs). Crowdfunding platforms raised about OMR19 million in 2025, more than three times the OMR5.9 million raised in 2024, while funded projects rose from 114 to 243 in the same period. Since 2022 these platforms have provided OMR29.4 million to 357 projects, after starting with just 21 projects worth OMR1.7 million in their first year.

“Not yet as OMR19 million is very small next to a banking system where SME lending is still around 3.7 per cent of total credit, below the 5 per cent floor set by the regulator,” said Shuja Khan, Business Head (GCC) at Graystone Capital. “What these platforms have proved is that the model works here. If it grows into invoice finance, sales-linked lending and Sharia-compliant private credit, the picture will change. If it stays a niche, the gap will stay where it is.”

Market dynamics and regulatory framework

The need for alternative finance is underscored by a regional SME funding gap estimated at about $250 billion across the GCC, and by the fact that small firms receive only around 3 per cent of total bank lending. Regionally, alternative lending in the Middle East is forecast to grow from $18.9 billion in 2025 to $31.3 billion by 2029, while Saudi Arabia had licensed 14 debt crowdfunding companies by late 2025.

• Regulation: The Financial Services Authority (FSA) licenses crowdfunding platforms under Decision No. 153/2021 and set minimum capital at OMR25,000 to encourage new entrants. The FSA cancelled two platform licences in 2025 as part of oversight.
• Central Bank role: The Central Bank of Oman (CBO) supervises financing, leasing, money transfers, electronic services, crowdfunding and Islamic finance under the Banking Law and must decide licence applications within 90 days. It has also established a fintech regulatory sandbox (opened December 2020), a fintech innovation hub and an accelerator.
• Infrastructure and players: The Mala’a credit bureau supplies credit data; platform graduates include Wadiaa, buy-now-pay-later firm Tasheel and savings app Zumr. Finance and leasing companies, buy-now-pay-later providers, and a small venture capital scene (including Oman Technology Fund and Phaze Ventures) complement crowdfunding activity.
• Public support: Oman Development Bank lends up to OMR20,000 for micro projects and up to OMR250,000 for SMEs. Riyada issued more than 19,000 Entrepreneurship Cards in the first half of 2026 and has financed over 400 projects worth OMR38 million since 2022. Future Fund Oman has OMR2 billion to invest over five years, allocating 7 per cent for SMEs and 3 per cent for startups.

Alternative lending models tend to focus on cashflows rather than collateral, Khan noted: “While a bank asks what a business owns. These lenders ask what a business earns, and they check it through payment records, invoices and sales data rather than years of audited accounts. Loans are usually smaller, decisions come faster, and no property is pledged.”

Outlook: Oman’s alternative lending landscape remains young but expanding. There were seven active platforms in 2025, down from nine as stronger operators consolidated. The fintech market was worth about OMR1.1 billion in 2025 and growing roughly 16 per cent annually. Islamic finance also plays an increasing role: Islamic banking assets reached OMR9.8 billion by May 2026, with Islamic financing at OMR7.9 billion. With nearly 267,535 SMEs at the end of 2025 and targeted national SME policy for 2026–2030 placing finance and market access at the centre, continued regulatory support and product diversification will determine whether alternative lenders move from niche providers to systemic contributors to SME finance.