Article 10: Managing Default Cases
| No: 106889333 | Date(g): 6/3/2025 | Date(h): 6/9/1446 | Status: In-Force |
Translated Document
Effective from Mar 06 2025 - Mar 05 2025
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| 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: | ||
| 1-1 | Establishing 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. | ||
| 1-2 | Developing 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. | ||
| 1-3 | Establishing 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. | ||