The following words and phrases, wherever they appear, in this Regulation shall have the corresponding meanings, unless the context otherwise indicates:

Law: the Finance Companies Control Law.

Finance Laws: the Real Estate Finance Law, the Finance Lease Law and the Law Finance Companies Control Law.

Regulation: the Implementing Regulation of the Finance Companies Control Law.

SAMA: Saudi Central Bank*.

Governor: the Governor of Saudi Central Bank.

Finance Company: a joint stock company licensed to carry out Finance activity.

Borrower: a person receiving Finance.

Consumer: a person to whom Finance Company’s services are directed.

License: a license issued by SAMA to a company to carry out Finance activity.

“Finance Activity” or “Finance Activities”: one or more types of Finance listed in Article 10 of the Law or any other Finance activities approved by SAMA pursuant to Article 10 of the Law.

Finance: extending credit under contracts for the activities set out in the Law and the Regulation.

Finance Agreement: a Finance Company extends credit for the activities set out in the Law and the Regulation.

Installment: the Total Amount Payable by the Borrower distributed over the term of the Finance Agreement, minus non-recurring expenditures, expenses and costs such as fees, commissions and administrative services fees.

Term Cost: the term cost to the Borrower under the Finance Agreement as a fixed annual or variable annual percentage applied to the Amount of Finance obtained by the Borrower.

Total Cost of Finance: all the costs to be paid by the Borrower under a Finance Agreement other than the Amount of Finance, including Term Cost, fees, commissions, administrative services fees, insurance, and any charges required to obtain Finance excluding any expenses the Borrower can avoid such as costs or fees payable by the Borrower due to his breach of any of his obligations contained in the Finance Agreement.

Amount of Finance: the ceiling or the total amounts made available to the Borrower under a Finance Agreement.

Total Amount Payable by the Borrower: the Amount of Finance and the Total Cost of Finance.

Annual Percentage Rate: the discount rate calculated in accordance with the provisions of Article 81 of this Regulation.

Board: the board of directors of the Finance Company.

Senior Management: the managing director, chief executive officer, general manager, their deputies, the chief financial officer and directors of major departments, in addition to the officers in charge of risk management, internal audit and compliance functions in the Finance company.

Exposure: the value of an asset that is subject to any credit risks, such as default risk or downgrade risk.

Large Exposure: the exposure of one Borrower by (5%) or more of the paid capital and reserves of the Finance Company.

Qualifying Interest: (5%) or more of the shares or the voting rights related to shares in the Finance Company whether held directly or indirectly either by one person or by several persons acting in concert.

* The "Saudi Arabian Monetary Agency" was replaced By the "Saudi Central Bank" in accordance with The Saudi Central Bank Law No. (M/36), dated 11/04/1442H, corresponding to 26/11/2020G.

SAMA shall organize the Finance sector and supervise the business of the Finance Companies in accordance with the Law and the Regulation as the following:

This article has been amended in accordance with His Excellency the Governor's Decision No. 85/M SH T dated 26/5/1441H.