Omani commercial banks can consider their non-funded credit to the extent of 1 per cent as part of the compulsory 5 per cent minimum credit for small and medium enterprises (SMEs).
Non-funded credit is extended by commercial banks to small units by way of letters of credit (LCs) for imports or guarantees for government projects.
The Sultanate’s banking regulator, the Central Bank of Oman, had asked commercial banks to extend a minimum of 5 per cent of their total commercial credit to small and medium enterprise (SMEs) a couple of years ago, in an attempt to support the growth of small industries.