Non-Bank Financing Boosts Private Sector Growth in Oman: Implications for Investors and Entrepreneurs
MUSCAT: The alternative financing sector is gaining momentum in Oman, serving as a crucial driver for private sector growth, according to Olivier Karno, Global Editor-in-Chief at the Oxford Business Group.
In a recent interview with CNBC Arabia, Karno highlighted the increasing significance of non-bank financial solutions. He stated, “In addition to traditional bank loans and credit facilities, the main sources of funding are linked to an increase in finance and leasing from the non-banking sector.”
He explained that this approach is vital as it helps to free up cash flow and enables companies to lower the direct costs associated with securing credit and financing. For industries that require substantial capital—such as mining, where starting operations often involves expensive equipment—alternatives to conventional lenders like finance and leasing offer flexibility and essential solutions with lower initial capital requirements.
Karno emphasized the importance of these financing options for start-ups and small and medium-sized enterprises (SMEs), which frequently encounter challenges in accessing traditional financing. “This is critical for start-ups and SMEs, especially in line with Oman Vision 2040. These companies can now tap into new types and forms of financing,” he noted.
The analyst further pointed out that alternative financing not only supports Oman’s economic transformation but also signifies the emergence of a new financial sector. “What’s important about this sector is that it aligns with the growth recorded in Oman regarding strategy, industrialization, renewable energy, and technology. It represents a fast-evolving and dynamic area of finance,” he said.
Karno concluded by affirming the essential role of alternative financing in fostering the growth of the private sector and contributing to the overall economic advancement of the Sultanate of Oman.
Special Analysis by Omanet | Navigate Oman’s Market
The rise of the alternative financing sector in Oman presents significant opportunities for businesses, particularly start-ups and SMEs, by providing flexible funding solutions that bypass traditional barriers. This shift not only aligns with Oman Vision 2040 but also encourages innovation and growth, making it crucial for investors to explore these non-traditional financing avenues. As the demand for innovative financial solutions increases, stakeholders should strategically position themselves to leverage this dynamic market shift for sustainable growth.
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