The Financial Services Authority (FSA) highlighted its efforts to advance regulatory reforms, encourage financial innovation and strengthen Oman’s capital market during its participation in The Network Forum Middle East.

Ahmed Al Mamari, Executive Vice President of the FSA, participated in a panel discussion titled “Vision 2040, Regulatory Development & Future Market Modernisation”, which explored the role of regulatory development in supporting Oman Vision 2040, enhancing market competitiveness and advancing the modernisation of the financial sector.

The discussion addressed three key areas, including advancing regulatory reforms to strengthen market competitiveness, enhancing governance, transparency and investor protection, and fostering financial innovation and investment diversification to support sustainable capital market growth.

Al Mamari emphasised the importance of establishing a regulatory environment that keeps pace with technological developments while maintaining effective oversight and investor protection.

“Innovation is evolving at an unprecedented pace, and our responsibility as regulators is to ensure that regulatory frameworks remain responsive and adaptable to these developments,” he said.

He highlighted the FSA’s regulatory sandbox as a key initiative enabling companies to develop and test innovative financial products and digital investment solutions under appropriate regulatory safeguards. The initiative allows the Authority to assess emerging technologies, identify potential risks and evaluate their suitability for the market.

He also underscored the importance of proportional regulation, noting that FinTech startups and emerging businesses require regulatory approaches that reflect the nature, scale and risks of their activities, rather than applying requirements designed for established financial institutions.

Al Mamari explained that regulatory flexibility plays an important role in accommodating emerging financial products and technologies through appropriate authorisation and evaluation mechanisms, contributing to market development and economic transformation.

Addressing Oman’s inclusion on the FTSE Russell Watch List, Al Mamari described the development as a significant step forward for the Muscat Stock Exchange (MSX) and the wider financial services industry.

He noted that the Sultanate of Oman had made considerable progress in meeting market quality criteria, while further developing market size remained a key priority in supporting its potential reclassification.

He pointed to improvements in the performance of the MSX and enhancements to market infrastructure over recent years, stressing the importance of facilitating foreign investment through efficient systems and greater market accessibility.

Al Mamari said the FSA continues to coordinate with the MSX, Muscat Clearing and Depository and brokerage firms to improve market access and provide international investors with systems and processes aligned with international practices.

He added that attracting foreign investment requires more than achieving international market classifications, as investors also consider the efficiency and accessibility of market infrastructure.

He further emphasised the importance of attracting long-term strategic and institutional investors capable of contributing to the sustainable development and stability of Oman’s capital market.

On regional cooperation, Al Mamari highlighted the FSA’s continued engagement with regulatory authorities across the GCC and other regional markets to exchange expertise, address shared challenges and strengthen regulatory coordination.

He referred to cooperation with financial regulators and stock exchanges in Egypt, as well as the Authority’s membership in the International Organization of Securities Commissions (IOSCO), which supports the adoption of international best practices.

He explained that these efforts cover regulatory frameworks, market infrastructure, operational systems, anti-money laundering measures, cybersecurity and risk management, while taking into account local market conditions and the need for proportionate regulatory requirements.

Turning to financial innovation, Al Mamari observed that FinTech startups and emerging technology companies are playing an increasingly important role in developing digital financial solutions and transforming traditional business models.

He noted that applications received through the FSA’s regulatory sandbox, alongside developments in international markets, demonstrate growing interest in technology-driven investment services.

Citing developments observed during a recent visit to Cairo, he highlighted the role of digital brokerage platforms in expanding retail investor participation, particularly among younger investors and individuals entering the market with smaller investment amounts.

Al Mamari encouraged established financial institutions, including brokerage firms and investment banks, to take a more proactive approach to innovation by developing digital solutions, adapting their business models and strengthening collaboration with FinTech companies.

He concluded by emphasising that closer cooperation between established financial institutions and emerging technology companies would contribute to building a more competitive, accessible and innovative capital market, supporting Oman’s broader economic development goals.