Section 2: Licensing Requirements and Procedures
Article 6: Licensing Requirements
I. The application for a license to practice Money Changing Business shall be submitted to SAMA. The following are the requirements for issuing the license:
a. The legal form of the Money Changer shall be any of the following:
1. a joint stock company;
2. a limited liability company;
3. a partnership;
4. a sole proprietorship; or
5. a foreign company branch licensed to conduct Money Changing Business.
b. Each founding member of the Money Changer must meet the eligibility requirements specified by SAMA and any conditions related to the proposed legal form of the Money Changer.
c. Provision of comprehensive and detailed information and data and any documents specified by SAMA for the Money Changer to be established. The following shall be attached to the application:
1. A feasibility study that includes the business plan, the administrative structure and the future plan for Money Changing Business.
2. An irrevocable bank guarantee for an amount equivalent to the capital issued in favor of SAMA. This guarantee shall be released upon the issuance of SAMA’s decision regarding the application.
3. For companies' licensing applications, the memorandum of association, articles of association, and proposed ownership structure.
II. SAMA may investigate the applicants by all means it deems appropriate to verify the submitted information, and the applicants shall provide SAMA with the necessary permissions.
III. Upon the completion of procedures and all preparations for the head office, SAMA shall address the Ministry of Commerce to complete the procedures according to the system. Upon issuance of the commercial register, SAMA shall issue the license for the applicant.
Article 7: Capital
The Money Changer shall, at all times, comply with the following:
a. The capital must not be lower than the following:
1. Two million (2,000,000) riyals for paid-up capital.
2. Seven million (7,000,000) riyals for paid-up capital for Money Changers licensed to import and export cash.
3. Ten million (10,000,000) riyals for paid-up capital for Money Changers licensed to transfer money inside and outside the Kingdom.
4. The Invested Capital of the branches of foreign money changers shall be determined by SAMA.
SAMA may amend the capital requirements whenever it deems appropriate.
b. Maintain at all times a minimum cash reserve of 5 percent of its capital (10 percent for Money Changers licensed to conduct money transfer activity). SAMA may amend this percentage whenever it deems necessary. The reserve shall be deposited with one of the licensed banks in the Kingdom to be at SAMA's disposal. The Money Changer or any other entity shall not be allowed to use this reserve in any manner without a written permission from SAMA. The reserve shall be subject to the constraints and instructions issued by SAMA.
c. The total value of assets should not exceed ten times the capital. SAMA may amend this limit whenever it deems appropriate.
d. Obtain SAMA’s prior non-objection according to the conditions before offering its shares for public subscription.
Article 8: License Term
a. The license shall be valid for a maximum of five years, renewable for a similar period or another period specified by SAMA.
b. The Money Changer must submit an application to renew the license at least six months before its expiration, in accordance with renewal requirements set by SAMA.
c. The Money Changer shall not conduct Money Changing Business if the license expires without renewal. If a month has passed since the expiration of the license without a renewal application from the Money Changer, or when such period has passed without meeting the renewal requirements, SAMA may revoke the license.
Article 9: License Fees
SAMA shall collect the following fees for issuing and renewing licenses:
a. Twenty thousand (20,000) riyals for issuing a license for the activity of purchasing, selling and trading of foreign currencies inside the Kingdom, and five thousand (5,000) riyals for renewal of license.
b. Thirty-five thousand (35,000) riyals for issuing a license for one or more of the activities set forth in Article 11 of the Rules - including the activity of purchasing, selling and trading of foreign currencies inside the Kingdom - and ten thousand (10,000) riyals for renewal of license without prejudice to the provisions of Paragraph (C) of this Article.
c. Forty thousand (40,000) riyals for renewal of the license to conduct money transfer activity inside or outside the Kingdom.
Article 10: Cancellation of Approval and Non-Commencement of Money Changing Business
a. SAMA’s approval shall be deemed cancelled in the event of non-completion of application procedures and not obtaining the license within six months from the date of the approval. SAMA may extend this period.
b. SAMA’s license shall be deemed cancelled if the Money Changer fails to commence its business within three months from the date of license issuance. SAMA may extend this period.
c. The fees collected are non-refundable in case the license was revoked.