Muscat - The Central Bank of Oman (CBO) reported an alarming increased in the number of bouncing cheques across the country.
According to updated statistics released by the country’s monetary regulatory authority, the overall number of dud cheques jumped by 16.7 per cent in 2017, to exceed 436,000 cases.
In 2016, the authorities reported 373,082 cases of bouncing cheques, up to a hefty 32.2 per cent jump from the previous year’s tally of 282,209 cases (2015).
Insufficient funds remained the leading reason for unpaid cheques in 2017, accounting for 77.24 per cent of bounced cheques, the apex bank stated in its newly published ‘Financial Stability Report 2018’.
In around 10 per cent of the total, the drawer’s account was either ‘Closed’, ‘Frozen’ or ‘Transferred’. MICR encoding errors were cited in 2.4 per cent of the cases.
Under the Oman Penal Code, a dishonored cheque is potentially a crime if proven by Public Prosecution that there was intent to defraud the intended beneficiary of the cheque. Penalties can include jail terms ranging from three months to two years in addition to a fine of up to RO 500.
The total number of cheques cleared by the banking system during 2017 also grew 4.53 per cent to 4.64 million, up from 4.44 million in 2016, according to the CBO Financial Stability Report.