The Saudi Central Bank (SAMA) has announced ‘updated rules for issuance and operation of credit cards’ that will supersede the previous regulations governing credit cards and monthly charges.
The updated rules establish guidelines for credit card issuers to enhance disclosure and transparency, as well as reduce the cost of credit cards for consumers.
The rules also include detailed provisions governing operational aspects of credit cards to increase consumers’ financial awareness and foster a regulatory environment that promotes innovation in the financial sector.
In addition, SAMA has collaborated with international card schemes to review and revise the fees and charges for credit-card transactions as part of SAMA’s broader strategy to enhance the digital payments for consumers and visitors to the Kingdom of Saudi Arabia, in line with the objectives of the Saudi Vision 2030.
According to the reports, SAMA requires that all credit and charge cards be issued only after a formal, written request from the consumer or an authorized representative. Additionally, any increase to a customer’s credit limit must also be formally requested and approved.
For non-resident employees, cards may be issued under certain conditions, such as being employed by a reputable Saudi company, and with the employer taking responsibility for credit limits and liabilities.
The card issuers are mandated to provide full transparency about card terms. This includes a detailed initial disclosure that outlines all fees, interest rates (APR), commissions, and repayment terms. Banks must also provide a simplified summary of the cardholder agreement to highlight key terms, as per various reports.
