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Use MADA Bank Cards for Buying Products through Internet

No: 391000075005 Date(g): 18/3/2018 | Date(h): 2/7/1439 Status: In-Force

Translated Document

Referring to the five-year strategy of the National Payments System "MADA", which includes several pathways, one of which is the growth and expansion pathway aimed at providing payment services via the Internet through MADA bank cards to target new sectors within the fields of e-commerce in alignment with the aspirations of the Kingdom as part of Vision 2030 regarding digital transformation.

SAMA has decided to allow all banks to start activating MADA bank cards for completing online payment transactions starting from 01/04/2018, while considering the following points:

  1. Payment transactions for electronic stores within the Kingdom must be processed through the national payments system MADA in accordance with the commercial requirements, rules, and technical specifications that have been shared with banks during the past period. This should be done after completing the necessary tests and permits and obtaining the required approvals from the MADA Authorization Center at the General Directorate of Payment Systems.
  2. Purchasing transactions for electronic stores outside the Kingdom must be processed through international payment companies and laws according to the relevant rules and requirements.
  3. Approve the pricing schedule accompanying the transactions executed locally using MADA bank cards while considering any previous agreements signed with electronic stores for accepting electronic payment services.
  4. Enable cardholders to control the allowed limit for online purchases through electronic channels before the date mentioned in SAMA Circular No. 391000062299 dated 02/06/1439H.
  5. Continue to notify customers of transactions executed online through SMS while adhering to SAMA Circular No. 381000060893 dated 07/06/1438H regarding the transaction type "Purchase via the Internet".

SAMA also hopes that all banks will actively contribute in the coming period to educate their customers, both individuals and electronic stores, about how to benefit from the service and how to subscribe to it, including dedicating marketing and awareness campaigns for this purpose.

Approved Pricing Model for MADA Bank Card Transactions in E-commerce Environment

(1) MADA Network Fees

Brief DefinitionThese are the fees paid by banks to SAMA for e-commerce transactions through MADA cards and consist of (a) Settlement Fees and (b) Authorization Fees.

Pricing Model

• Authorization Fees 

• Settlement Fees

Same pricing schedule as the basic pricing model for MADA devices for point of sale regarding MADA debit cards and MADA prepaid cards.

 

(2) Bank Interchange Fees

Brief DefinitionThese are the fees paid between banks. They refer to the fees paid by the acquiring bank to the issuing bank for each transaction conducted in the e-commerce environment, calculated based on the transaction value.

Pricing Model

• Interchange Fees

• 0.70% of the purchase transaction value is paid by the acquiring bank to the issuing bank for each transaction conducted through MADA cards in the e-commerce environment. 

• There is no cap on bank interchange fees.

 

(3) Merchant Service Charge – MSC

Brief DefinitionThese are the fees paid by the electronic store to the acquiring bank for each purchase made through MADA cards in the e-commerce environment, calculated based on the transaction value.

Pricing Model

• Merchant Service Charge – MSC

• 1.75% maximum for each purchase paid to the acquiring bank (Acquirer), as the liability percentage is negotiable between the acquiring bank and the merchant.

• There is no cap on merchant service charges.

According to SAMA Circular No. (43096118) dated 20/11/1443H, and due to the growth of the e-commerce sector in the Kingdom and the desire to improve the mechanism for collecting data related to e-commerce, SAMA emphasizes the importance for all banks to comply with the operational framework, and technical and operational rules related to the Data Quality Development Project, which was shared with all banks in April 2022 by the Saudi Payments Company, while ensuring compliance with the following:

  1. First: Complete all requirements mentioned in the operational framework and technical and operational rules related to the Data Quality Project.
     
  2. Second: Commit to sharing data based on the agreed mechanism for sending data with Saudi Payments.

With emphasis on the commitment of all parties to the provisions of the Personal Data Protection Law issued by Royal Decree No. (M/19) dated 09/02/1443H concerning the retention, collection, processing, and sharing of personal data.