Digital Payments & Fintech · Bahrain
Fintech & payments regulation in Bahrain (2026)
Bahrain shaded by its digital payments & fintech status
Fintech and digital payments in Bahrain: licensing regime, under Central Bank of Bahrain (CBB) under the Central Bank of Bahrain and Financial Institutions Law 2006, implemented via the CBB Rulebook, notably the Payment Service Provider (PSP) framework and Volume 5 (Specialised Licensees / Ancillary Service Providers), plus the Bahrain Open Banking Framework..
Bahrain operates a clear, established licensing regime for digital payments and fintech, with the Central Bank of Bahrain (CBB) as the single integrated regulator. Payment service providers and e-money issuers must be CBB-licensed under the Rulebook, open banking is mandatory for retail banks, and a national instant-payment rail (Fawri+) is in operation. Buy-now-pay-later is being brought fully into the perimeter via a dedicated rulebook module that was under review following a 2025 consultation.
Key points
The CBB is the integrated financial regulator and licenses payment service providers under the CBB Rulebook. Applications follow a single-phase process under the 2006 Law, with the CBB deciding within 60 calendar days of a complete application.
Payment and electronic-money activities sit within the CBB Rulebook (Volume 5 specialised/ancillary licensees), with prudential expectations on capital adequacy, surety bonding, AML/KYC and ongoing reporting.
The CBB launched the Bahrain Open Banking Framework on 28 October 2020 (after first mandating open banking for retail banks in December 2018). Updated open banking rules requiring customer consent/authentication, licensee disclosures and API performance reporting took effect from 1 September 2024.
The CBB-authorised BENEFIT Company operates the Electronic Funds Transfer System (EFTS); its Fawri+ service provides 24x7x365 real-time IBAN-based transfers (settled within ~30 seconds), alongside Fawri and Fawateer bill payment.
2022 amendments to Volume 5 (financing companies) opened the market to BNPL providers; the CBB closed a consultation in late 2025 on a dedicated BNPL module that would classify BNPL as regulated short-term credit subject to capital, conduct, consumer-protection, disclosure and digital-security rules.
The CBB runs a FinTech Regulatory Sandbox allowing payment and fintech startups to test models in a controlled environment before obtaining a full license.
Timeline - major decisions & events
The Central Bank of Bahrain introduced the Stablecoin Issuance and Offering (SIO) Module in Volume 6 of its Rulebook, establishing licensing, reserve, governance and redemption rules for fiat-referenced (BHD, USD or other approved currency) stablecoin issuers. It is the Gulf's first comprehensive stablecoin regime.
Central Bank of Bahrain ↗A CBB circular made new Open Banking obligations effective, requiring consent and authentication, licensee disclosures and API performance reporting, and extending account-information and payment-initiation services to corporate/institutional customers rather than just individuals.
The Paypers ↗The CBB amended its Crypto-Asset (CRA) Module to regulate digital token offerings, introducing definitions for asset/utility tokens, a mandatory whitepaper template and enhanced cyber-security rules, and clarifying when tokens are treated as securities.
Central Bank of Bahrain ↗The CBB launched the comprehensive Bahrain Open Banking Framework (operational guidelines, security and customer-experience standards, technical API specifications and governance), making Bahrain the first MENA jurisdiction to mandate technical open-banking standards.
Central Bank of Bahrain ↗The CBB published final rules requiring anyone offering crypto-asset services or operating crypto-asset exchanges within or from Bahrain to be licensed, covering minimum capital, governance, AML/CFT, custody, market-conduct and cyber-security standards.
Central Bank of Bahrain ↗The CBB added Open Banking rules to Volume 5 (Ancillary Service Providers), establishing licensing for account-information service providers (AISPs) and payment-initiation service providers (PISPs), the regulatory foundation for the later open-banking framework.
CBB Rulebook (Thomson Reuters) ↗The CBB introduced a regulatory sandbox letting licensed and unlicensed fintech firms test technology-based solutions for up to a year under supervision, a foundational mechanism for licensing new payment and fintech business models in Bahrain.
Central Bank of Bahrain ↗Decree No. 64 of 2006 promulgated the CBB Law, creating the Central Bank of Bahrain as the single integrated regulator of the financial sector, the statutory basis for all licensing of banks, payment service providers, money transmitters and fintech firms.
Central Bank of Bahrain ↗Bahrain - other topics
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