In the letter of HE the Minister of Finance and National Economy No. 206-405 dated 15-1-1405 H, regarding the use of checks for paying civil servants salaries through local banks, HE requested us to notify the banks as follows :

1. Starting with the budget of the coming fiscal year 1405/1406 government agencies may open accounts with local banks for the payment of their employees' salaries by check. Such an account shall be used solely for this purpose.
2. The opening of such an account shall be limited to Ministries and independent government agencies listed in the attached list and their affiliated branches in the Kingdom. Only one account may be opened by the agency or its branch.
3. The account shall be opened in the name of the agency or branch, not in the name of a specific employee (s).
4. The bank in which the account is to be opened shall be specified by SAMA at the request of the concerned agency.
5. Banks undertake to cash salaries with no service charges.
6. Checks are valid for one month from the date of issuance and are endorsable only to banks.
7. The concerned agency shall feed its current account, when opened, with a net average of its monthly payroll, plus 50%, by a check issued by the Ministry of Finance and National Economy.
8. The bank shall provide the concerned agency, at the end of the 10th day of each month, with a statement indicating the number and amounts of cashed checks. After reviewing such statements, the bank shall be reimbursed for cashed amounts. With regard to the statement of the payment of salaries for Jumada I of each year, the banks shall be reimbursed in the middle of Jumada II.
9. The banks shall not be reimbursed for statements of account evidencing salary payments for the month of Jumada II of each year. Banks have to transfer any surplus balance in the current account to the current account of the Ministry of Finance and National Economy with Saudi Central Bank before the end of Rajab each year. The bank shall send the statement of accounts evidencing the payment of salaries for the month of Jumada II, along with Saudi Central Bank's notice evidencing the transfer of the agency balance therewith.
10. The agency shall obtain check books through a letter addressed by the authorized person to the bank.
11. The authorized person, who shall not hold a title less than director general, will provide the bank with signature samples of the persons authorized to sign the checks.
12. With regard to government agency branches, the agency with which the branch is affiliated shall make the necessary arrangements for opening the branch account at the selected bank. This account shall be fed with a net average of employees salaries for 2 months. The branch director shall provide the bank with the name of persons authorized to sign the checks and their signature samples. The agency with which the branch is affiliated shall reimburse the bank gradually for paid salaries to maintain sufficient cash liquidity.
13. The Ministry of Finance & National Economy, the General Audit Bureau or Saudi Central Bank may send representatives to check on these statements of account or to ask for copies thereof.

We wish to emphasize that no direct accounts may be opened for this purpose except through Saudi Central Bank.