Cheque bounce defaulters beware! Fine up to RO 20000 CBO’s new regulations

His Highness Sayyid Taimur bin Asa’ad bin Tariq Al Said, Chairman of the Board of Governors of the Central Bank of Oman, issued Ministerial Resolution No. BM/9/57/2023, issuing regulations the direct debit system and returned cheques (bounced).

The regulations included some articles of the decision stipulate the licensed banks to provide the system with all data related to the returned cheques. This data includes account holders who have (2) two or more returned cheques in a month or (4) four or more returned cheques during (6) Six months, or (6) six returned cheques within one year, regardless of whether those cheques were returned through one or more banks.

The banks are required to provide the name and ID of the owner of the returned cheque, the numbers and dates of its issuance and return, the value of its amounts, the names of its beneficiaries and the reasons for its return, and any other data specified by the Central Bank of Oman for the purposes of analyzing information and setting policies.

The licensed banks shall be responsible – alone and exclusively – for the accuracy and updating of the data related to the returned cheque. The Central Bank or the hosting entity – based on the data it receives from the licensed banks – shall prepare a unified warning list of the names of the account holders referred to in Article (4) of the regulations.

Licensed banks, financial institutions, credit bureaus, their participating members, and others, as determined by the Central Bank, may also review the warning list in order to benefit from it for the purpose of assessing credit status and financial solvency.

Licensed banks or any authorized person may not use the system to benefit from information related to the returned cheques except for the purposes for which it was requested.

Licensed banks must exercise caution when dealing with account holders whose names appear on the unified warning list, and must withdraw check books from them, not open current accounts for them, and refrain from providing them with direct debit services, for a period of one year from the date of returning the returned instrument, without prejudice. Any financial fines or other procedures determined by the Central Bank.

The new regulations clarify that the Central Bank of Oman may impose an administrative fine not exceeding (20,000) twenty thousand Omani riyals upon violating the provisions of the regulations.