Overview
The e-Commerce market in Oman is estimated at $575 million in June 2023, and is expected to reach $1.1 billion by 2028, growing at 13.5 percent during the forecast period according to Modor Intelligence Research agency.
The necessity of doing business remotely during Oman’s COVID-19 outbreak accelerated digitalization and growth of businesses in the ICT sector. The high number of Internet users in Oman, coupled with the Omani government’s promotion of a “digital society” and “e-government,” present opportunities for B2C and B2B eCommerce. According to the Digital 2022: Oman report, Oman has approximately 5.02 million active Internet users, 5.87 million mobile connections and 4.39 million social media users.
The government made many services available online to mitigate exposure to COVID-19, such as business registration and customs clearance of imported goods, payment of utility bills, and payment of traffic fines.
Current Market Trends
Oman’s government implements the e-Government initiative in conjunction with the provision of electronic payments (e-Payments) and Internet payments and it requires online payments for most government services. The national ePayment Gateway portal enables secure payments for e-Government services, eCommerce, eTendering, online donations, and a host of other online transactions.
Oman’s Electronic Transactions Law, adopted in 2008, legalized the use of digital signatures in electronic commerce and communications through letters, emails, etc., to assure adequate protection to both businesses and the common public. The law also stipulates penalties for electronic crimes involving e-transactions and provides limited privacy protections for personal data.
Domestic eCommerce (B2C)
Omani consumers primarily shop online for clothing, airline tickets, beauty care products, and hotel reservations. Oman has witnessed a growth in domestic eCommerce, particularly for groceries, as businesses moved to online platforms when physical stores closed due to COVID-19 restrictions. An increasing number of businesses, especially Omani-owned SMEs and entrepreneurs, promote and sell their merchandise through social media.
Cross-Border eCommerce
For cross-border shopping, Omani e-shoppers primarily buy clothing, airline tickets, beauty care products, and hotel services, according to a 2022 study by market advisory firm, Mordor Intelligence. For cross-border e-shopping, China remains the main country of origin for ordering furnishings, machinery, and construction materials, according to the report. Omani residents also use vehicle-related websites in the United States to order spare parts and supplies.
B2B eCommerce
Omani companies and individuals order products directly from foreign companies and make payments through bank transfers or money exchanges. Courier companies such as FedEx and DHL ship the goods.
eCommerce Services
Oman Post is working on serving the eCommerce market and making use of Oman Post’s branches and vehicles for deliveries of products ordered online. Oman Post operates an e-shipping service called Matjar, allowing customers in Oman to receive goods purchased from U.S.-based online merchants. Government owned Asyad Express also offers cross border shipping.
eCommerce Intellectual Property Rights
In February 2022, Oman issued a data protection law that requires entities to obtain prior written consent from individuals before holding or processing their personally identifying information. The law also controls the transfer of personal data outside of Oman and requires entities to obtain approval from the Ministry of Transport, Communications, and Information Technology (MTCIT) for processing certain types of sensitive personal data. MTCIT is yet to publish the corresponding regulations for the law, which has gone into effect from February 2023.
Popular eCommerce Sites
The top ecommerce sites in Oman are Amazon, eBay, and AliExpress. Other top retail sites include Namshi, Royal Oman Police, InvestEasy, and Bayan Customs. Online food order and delivery apps and grocery delivery websites and apps have gained popularity. Many brick-and-mortar shops have launched eCommerce facilities or are in the process of doing so.
Online Payment
Payment gateways use bank cards, money exchanges, and bank transfers. A Central Bank of Oman report showed that the volume of e-payment transactions in Oman increased by 40 percent in 2022.
Mobile eCommerce
Alternative payments are gradually gaining prominence in Oman, with banks and telecom companies launching services. The Central Bank of Oman’s MpClear and Omantel’s eFloos apps facilitate mobile-based instant payments. Thawani Technologies, one of Oman’s leading mobile payment platforms, received the Central Bank of Oman’s first fintech license in 2020. The Central Bank of Oman recently issued guidelines for banks and payment service providers to offer a card tokenization service allowing customers to register payment cards and applications like Apple Pay and Samsung Pay in Oman.
Social Media
Oman had 4.39 million social media users in January 2021 (83 percent of the population), representing a 6 percent increase between 2021 and 2022, according to the Digital 2022 study by research firm DataReportal.com. Businesses, especially Omani-owned SMEs and entrepreneurs, increasingly promote and sell their merchandise through social media. Companies are increasingly using “social media influencers” for store and product promotions.