Personal loan calculator Oman: EMI, interest and CBO caps

What CBO's rules for personal loans say

• Highest rate: 6% a year on personal loans, housing loans and overdrafts against salary — a fixed figure CBO says may change from time to time.
• Effective rate: the rate must be the effective rate on the reducing balance. Flat rates are not allowed, and neither is a low teaser rate that rises later.
• Variable rate: a change must be notified to you 2 months before it takes effect.
• Longest term: 10 years, and only until you are 70 (counting your expected net pension).
• Debt burden: all monthly debt payments at most 50% of net monthly salary; pensioners at most 30% of net pension up to OMR 3,500, 40% above. Every debt counts — cards, overdrafts, finance and leasing companies.
• Fees: processing fee at most OMR 25, none for pensioners with a net pension under OMR 1,000. Administrative fee for credit-life insurance/takaful: at most 0.05% of the loan, at least OMR 5 and at most OMR 75.
• Late payment: penal interest at most 1% a year, on the overdue amount and for the overdue period only.
• Top-up: A personal-loan top-up only after 24 months of good payment, once 50% is repaid, or when the full eligibility was not used when the loan was first given.
• Eid deferrals: at most 2 a year on a personal loan, and only with your consent — never automatic.
• Moving the loan: another bank may take over a personal loan; the loan keeps its category.
• Who and how much: CBO's circular makes no distinction between Omanis and expatriates, and sets no maximum loan amount. Personal loans not based on salary, and loans against your own term deposits, fall outside these limits.

Islamic banking

The same circular covers Islamic banking entities: the limits on rate, term, debt burden and fees apply to Islamic personal finance too, and the charge is called profit instead of interest — the maths is the same. Islamic banks have the same 1% ceiling on default penalties.

Paying off early costs at most 1% of the amount prepaid: early settlement calculator. A card balance: credit card minimum payment.

Finance and leasing companies

Finance and leasing companies are licensed by CBO but are not banks: CBO's Master Circular on Personal Loans/Finance for banks (BM 1213) does not apply to them. Their own CBO circulars — FM 41 (2023) on what they may do and FM 31 (2013) on charges — say:

• Personal loans: without collateral and for a non-business purpose only. All debt payments at most 50% of net monthly salary under OMR 1,000 a month, and at most 60% from OMR 1,000, or when you also repay a housing loan. Net salary is what reaches your bank account each month.
• Term: at most 7 years (banks: 10), plus up to 2 monthly deferments a year at your request; the company must consider your age so that the loan ends reasonably ahead of retirement.
• Top-up: Finance and leasing companies: a personal-loan top-up only after 12 months of satisfactory payment, after 50% of the loan is repaid, or when the first loan did not use the customer's full eligibility.
• Interest rate: CBO does not cap the interest rates of finance and leasing companies, unlike banks; in 2013 it found rates as high as 24% a year and told the companies to review them and be moderate. Compare offers on the real yearly rate.
• Charges: paying off early at most 1% of the amount prepaid; rescheduling at most OMR 10 for an individual; duplicates at most OMR 5; basic certificates (no-due, release letter, balance confirmation) only a nominal amount; late (penal) interest at most 2% over the loan or lease rate (CBO's wording: "shall not exceed 2 % of the same").
• Up front: all terms and charges, including the effective rate, must be disclosed in full before you sign, and changes notified well ahead.

A loan from a finance and leasing company still counts in a bank's debt-burden check. The older master circular for these companies (FM 19, 2006) is not on CBO's website, so a rule in it that FM 41 did not change could still apply — ask the company to show its terms in writing.