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  • Debt Collection Regulations and Procedures for Individual Customers

    No: 106889333 Date(g): 6/3/2025 | Date(h): 6/9/1446Status: In-Force

    Translated Document

    • Chapter One: General Provisions

      • Article 1: Definitions

        The terms and expressions used in these regulations and procedures shall have the meanings assigned to them as follows, unless the context requires otherwise: 

        Term

        Definition

        SAMA

        The Saudi Central Bank.
         

        Creditor:Banks and finance companies.
         
        Debt CollectionCreditors collecting the amounts payable by the consumer - or his guarantor in case of default - under the provisions of the finance contract.
        CreditorsBanks, and finance companies subject to the supervision and control of SAMA in accordance with the regulations in force.
        ConsumerA natural person who has obtained the financing product.
         
        GuarantorA natural person who undertakes to perform all or some of the consumer's obligations.
         
        Third PartyAn external party who practices or initiates any of the collection procedures for the benefit of the creditor
         
        Compelling Change in Circumstances:An event leading to a compulsory change in the consumer's financial circumstances that materially affects the consumer's ability to fulfill his/her financial obligations, such as but not limited to: Inability to work (partially), retirement (compulsory), job loss, loss of fixed allowances given to the consumer by his/her employer on a monthly basis, or salary reduction.
         
        Voluntary Change in Circumstances:An event that leads to a change in the consumer's financial circumstances at the consumer's request, such as but not limited to Early retirement or resignation.
         
        Default:Consumer's failure or delay in paying a certain number of due installments or part thereof agreed upon in the finance contract, in accordance with the provisions of paragraph (1) of Article 9 of the Regulation.
         
        Total DisabilityA health condition that prevents the consumer from practicing his normal life and results in the consumer being medically unfit for work according to official reports issued or approved by the legally competent authority.
         
        ComplaintAny expression of the consumer's dissatisfaction with the provided service or product, whether justified or not, written or verbal.
         
        Documented CommunicationAn official, verifiable and retrievable means of communication in paper or electronic form.
         
        Consumer's ConsentPrior consent from the consumer through authenticated means of communication.
         
        Phone CallThe call that the consumer responded to and interacted with the employee about.
         
        CommunicationThe process of exchanging information and data by any means of documented communication between the creditors and the consumer, whether oral or non-verbal (such as sign language) for people with disabilities.
         
        EmployeesAny natural person who works for the interest of the creditors and under their management or supervision for remuneration, including - for the purpose of applying the controls - all employees contracted directly or contracted through a third party.
         
        DayCalendar day including weekends and public holidays.
         

      • Article 2: Objectives

        These regulations aim for creditors to achieve the following: 

        1. Improve the efficiency of debt collection by implementing effective procedures to reduce the rate of non-performing loans. 
           
        2. Adhere to professional conduct when dealing with consumers. 
           
        3. Follow the minimum procedures that must be adhered to when communicating with consumers or their guarantors for the purpose of rescheduling potentially defaulting debts or during collection. 
           
        4. Protect the privacy of consumers and their guarantors.
           

      • Article 3: Scope of Application

        These regulations apply to creditors and third parties. 
         

    • Chapter Two: Communication Regulations with Consumers and Their Guarantors

      • Article 4: Communication Regulations with Consumers

        Creditors must adhere to the regulations, instructions, standards, and professional conduct when communicating with the consumer or their guarantor and comply with the following as a minimum:

        1. Protect the financial and personal information of consumers and guarantors, maintaining their privacy, and not using such information except for specific professional and legal purposes with the consumer's consent. 
           
        2. Do not make any phone calls to anyone other than the consumer or their guarantor, and verify the identity of the call recipient at the start of the phone call. 
           
        3.  Limit phone call attempts with the consumer or guarantor to not exceed ten phone calls - at most - every thirty days for each financing product - in case of multiple products, and enable the consumer or guarantor to return the call to the number used to contact them, ensuring communication occurs during official working hours. 
           
        4.  Document communication with consumers or guarantors (incoming or outgoing), and retain records for no less than ten years from the date of communication, and inform the consumer or guarantor at the beginning of the phone call that it is being recorded. 
           
        5. Enable consumers or their guarantors to evaluate their satisfaction at the end of the phone call, whether for collection purposes or to receive complaints, ensuring this is documented electronically. 
           
        6. Activate direct channels for communication with consumers to allow inquiries or clarifications regarding existing claims. 
           
        7. Do not communicate with the consumer or their guarantor using envelopes with phrases indicating they contain debt collection information or similar. 
           
        8.  Do not visit the consumer or their guarantor under any circumstances, whether at their residence or workplace. 
           

    • Chapter Three: Collection Procedures

      • Article 5: Communication Mechanism with Consumers 

        When communicating with consumers or their guarantors for collection purposes, creditors must adhere to transparency and disclosure, and comply with the following: 

        1-Limit authenticated communication means to:  
         
         1-1Email.  
         
         1-2Registered mail (national address).
         
         1-3Text messages.
         
         1-4Phone calls.
         
         1-5The creditor's app or website. 
         
         1-6Judicial notification.
         
        2-Provide the consumer with the necessary communication-related information, including:  
         
         2-1Creditor's name and the department concerned with collection, or the third party and the name of the creditor they are communicating on behalf of.  
         
         2-2The contact number of the concerned department or third party. 
         
         2-3Working hours of the concerned department or third party.
         
         2-4 The employee's name in case of a phone call. 
         
        3-Appoint Arabic as the primary language for communication, except when communicating with non-Arabic speakers, while fully adhering to the regulation.
         
        4-In case the communication is written, all phrases and numbers used must be easy to understand and clearly legible, including headers and footers. 
         

      • Article 6: Handling Objections

        If there is an objection from the consumer or their guarantor regarding the amount claimed, creditors must: 

        1. Document the complaint electronically in the consumer's file, enabling them to view it. 
           
        2. Register the consumer's or guarantor's complaint based on the instructions issued by SAMA. 
           
        3. Provide the consumer or guarantor with the expected time frame for resolving the complaint, not exceeding the periods specified by SAMA. 
           
        4. Do not communicate with the consumer or guarantor to remind them of defaults until the complaint is resolved. 
           
        5. Present the results of the complaint resolution to the consumer or guarantor and support it with documents justifying the resolution decision. 
           
        6. If the consumer or guarantor is dissatisfied with the complaint resolution and wishes to escalate it, creditors must provide the consumer with the escalation mechanism and direct them to the appropriate entity. 
           

    • Chapter Four: Debt Collection Management Regulations

      • Article 7: Mechanism for Setting Deduction Dates from Consumers' Accounts

        Creditors must:

        1. Set the deduction date in accordance with the salary deposit date for salaried consumers, or as agreed upon with the consumer for non-salaried consumers, ensuring it is specified in the finance contract or repayment schedule, considering changes in salary deposit dates, whether continuous or temporary (e.g., when salary deposit date coinciding with weekends or holidays). 
           
        2. Deduct the installment on the agreed date, and if the agreed date is exceeded due to a creditor's reason without obtaining the consumer's consent for deduction for each case individually after the agreed date, creditors are obliged to add a similar period at the end of the finance period without calculating any term cost or additional fees, with notification to the consumer through authenticated communication means. 
           

      • Article 8: Installment Deduction Regulations from Consumers' Accounts

        1-Creditors are prohibited from:
         
         1-1 Deducting any amounts from the consumer's accounts without a judicial order or ruling, or without obtaining the consumer's consent, or if the finance contract does not permit deduction for banks and finance companies, Or the agreement to deduct the outstanding finance amounts granted without a salary guarantee through the consumer's bank accounts for finance companies.
         
         1-2Blocking accounts or balances of consumers, even temporarily, and denying them access to funds available in the accounts without a judicial order or ruling, or without obtaining the consumer's consent, or if the finance contract does not permit blocking, without prejudice to the statutory provisions and related provisions in the regulation.  
         
         1-3 Deducting more than one installment for each finance contract within a single salary deposit cycle, unless there is a judicial order or ruling, or with the consumer's consent. 
         
         1-4Deducting the installment before the agreed due date, or withholding the installment amount before the due date.  
         
         1-5Withholding or deducting end-of-service gratuities for national consumers, unless there is a judicial order or ruling, or with the consumer's consent. 
         
         1-6Imposing delay penalties or collection fees exceeding the due amount, with a maximum of one installment value for the entire finance period. 
         
        2-Creditors must adhere to the deduction limits from the accounts of joint consumers - for joint finance contracts - as agreed with each consumer individually according to the finance contract. 
         

      • Article 9: Managing Potential Default Cases

        1-For the purpose of applying the regulations, creditors must consider calculating default as follows:  
         
         1-1 For consumer default on monthly installments:
        When it is proven that the consumer has not committed to paying installments fully or partially for three consecutive months, or delays in paying five separate installments for seven working days or more for each installment from its due date throughout the contract period, and for every five years of the real estate finance contract duration.  
         
         1-2Default in finance contracts granted (non-monthly installments):
        When it is proven that the consumer has not committed to paying the due installment (quarterly, semi-annually, annually) for more than 60 working days, or delays in paying four separate installments for 20 working days from the agreed due date in the finance contract, or more than five separate months throughout the finance period, and for every five years of the real estate finance contract duration.  
         
        2-Creditors must find proactive solutions when indicators of a change in the consumer's credit status appear that may lead to default, including at a minimum: 
         
         2-1Offering the option to reschedule the debt to the consumer if a change in their circumstances is proven (compulsorily) without granting new finance, without any additional fees, and without any change in the term cost. Creditors must execute the rescheduling - if requested by the consumer - within a period not exceeding 20 working days from the date the consumer provides the necessary documents, and creditors must postpone the deduction of installment amounts until the rescheduling procedures are completed. 
         
         2-2Rescheduling the debt for the consumer if the reason is due to the creditor's failure to assess the consumer's creditworthiness, including but not limited to exceeding the statutory deduction ratios, without granting new finance, without any additional fees, and without any change in the term cost. 
         
        3-Creditors may offer the option to reschedule the debt to the consumer if a change in their circumstances is proven (optionally), with the possibility of changing the term cost and without any additional fees, provided that the rescheduling is executed - if requested by the consumer - within a period not exceeding 20 working days from the date the necessary documents are provided by the consumer. 
         

      • Article 10: Managing Default Cases

        1-Creditors must, before resorting to competent authorities, ensure communication with consumers and their guarantors for collection purposes, and exert due diligence in managing the settlement and collection of defaulted debts, including but not limited to:
         
         1-1Establishing necessary standards to ensure employees adhere to the required professionalism, providing consumers with correct and comprehensive information about their current status, the procedures governing collection, and the legal actions that may be taken in case of default or non-compliance.
         
         1-2Developing internal work procedures between relevant departments, including service level agreements and escalation mechanisms to ensure consumer objections and complaints are resolved within the statutory period in the instructions issued by SAMA related to this matter, with the mechanism documented electronically and the departments' compliance with it is measured.
         
         1-3Establishing a written policy to organize collection procedures from consumers or their guarantors, approved by the board of directors or manager, as appropriate, considering at a minimum:
         
          a-Solutions that can be offered to the defaulting consumer based on their creditworthiness, including but not limited to debt settlement between two parties, or rescheduling the debt and deferring installments, avoiding financing solutions that may increase the financial burden on the consumer, such as granting additional finance.
         
          b-Procedures through which creditors ensure the consumer is provided with clear and comprehensive information to the fullest extent possible to help them understand collection procedures and the consequences of default, as well as understanding the proposed solutions and the differences between them if more than one solution is offered.
         
          c-Analysis of complaints and objections and their patterns, addressing their causes and sources, and the role of the department responsible for handling complaints in documenting these reports and measuring their effectiveness in addressing the sources of recurring complaints.
         
          d- Reviewing the policy periodically and ensuring its alignment with best practices, statutory provisions, and related instructions, and updating it as needed or every two years at most.
         
          e- Ensuring that employees of creditors and third parties involved in collection tasks are aware of the policy and provide proof of their awareness. 
         

      • Article 11: Managing Cases of Total Disability or Death

        1-Creditors must exempt the consumer and their guarantor from the amounts claimed under the finance contract or joint finance contract - according to their obligations in the finance contract in the event of death or total disability - without making the exemption contingent on the approval of insurance service providers or any external party. Creditors must complete the procedures within a maximum period of thirty days from the date of receipt of the death certificate or total disability report, refund any amounts deducted in excess from the date of death or total disability, and transfer ownership of the financed asset to the consumer - according to the ownership percentage in joint contracts - or their heirs, or release the mortgage - as appropriate - unless the parties agree to include any of the following exceptions:  
         
         1-1Finance contracts concluded before 01/10/2018G.  
         
         1-2Cases of death or total disability resulting from:
         
          a-The consumer deliberately injuring themselves or attempting suicide. 
         
          b-Natural disasters.
         
          c-Judicial rulings issued by Saudi courts.  
         
          d-Consumption of alcohol, narcotics, or illegal drugs.
         
          e-Participation or training in dangerous sports or competitions, such as: (horse or car racing). 
         
          f-Damage caused or contributed to by nuclear weapons, ionizing radiations, radioactive contamination from any nuclear fuel or waste, contamination due to nuclear fuel combustion, war, invasion, acts of foreign enemy, hostilities, warlike acts, or acts of vandalism and terrorism committed by person(s) working individually, on behalf of, or in relation with any terrorist organization. 
         
        2-Creditors are prohibited from delaying the procedures for exempting consumers, and they must immediately request the necessary documents, represented by the death certificate or the medical report issued by a competent authority proving total disability, and exert due diligence to process and complete the exemption process within the time frame specified in the regulations. 
         

    • Chapter Five: Final Provisions

       

      1. Creditors must adhere to the regulations and are responsible for any violations committed by their employees or third parties. 
         
      2. The regulations set the minimum requirements for creditors to exercise due diligence in all stages of the collection process, and they must continuously develop their internal procedures in line with the nature and size of their business, and according to the best local and international standards and practices, without conflicting with the regulations and related instructions. 
         
      3. The department responsible for managing collection operations must be subject to review and audit by the internal audit and compliance departments at creditors on an annual basis to ensure the soundness of procedures and their compliance with the regulations and related instructions. 
         
      4. Creditors are responsible for evaluating and assessing the consumer's credit and financial status and ensuring their ability to fulfill their obligations throughout the contract period, considering and accommodating changes that may occur in their circumstances in accordance with the instructions issued by SAMA. 
         
      5. The regulations update previous regulations or instructions issued in this regard and replace the provisions of the Debt Collection Regulations and Procedures for Individual Consumers (First Edition), and creditors and third parties must update their policies, procedures, contracts, and agreements in line with them. 
         
      6. The regulations are effective from the date of publication on SAMA's website.