The recent changes align with SAMA’s commitment to advancing digital payments and are part of the Saudi Arabia Vision 2030 initiative.
Key Aspects of the New Credit Card Regulations:
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Cash withdrawal fee: Limited to 3% for amounts under SAR 2,500, with a maximum of SAR 75 for withdrawals of SAR 2,500 or more.
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International transactions: A flat fee of 2% for purchases made abroad.
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E-Wallet top-ups: These are free when funded via your credit card.
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Overspending: Customers can withdraw extra funds that exceed their credit limit without incurring any fees.
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Fee transparency: All charges must be clearly outlined in a standardized format.
Maximum fees (not including VAT):
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Cash withdrawal: 3% up to SAR 75
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Late payment: SAR 50
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Dispute submission fee: SAR 25
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International purchases: 2%
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Local POS and online payments: free
More Transparency and Control for Consumers
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SAMA urges credit card issuers to:
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Send SMS notifications about fee changes with a 14-day notice, allowing customers to cancel their cards without penalty.
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Provide account statements via SMS to alert customers of all financial transactions.
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Introduce a fee calculator tool to give quotes prior to purchases.
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Allow a 25-day grace period for paying off the balance without penalties before deferred fees kick in.
The new regulations also aim to standardize the presentation of fees and benefits in credit card agreements, making it easier for consumers to comprehend the costs and terms involved.
Comparison of Old and New Pricing Structures
In the past, there was a substantial charge of SAR 75 for transactions up to SAR 5,000, plus 3% (capped at SAR 300). The updated cap of SAR 75 now applies to all significant withdrawals, making terms more favorable for users.
Charges for invalid dispute submissions and account statement requests will now be SR 25.
These alterations stem from a partnership between SAMA and the International Card Network, which revisited transaction costs as part of a larger initiative to modernize the payment landscape in the Kingdom and broaden digital financial services.
Enhanced Customer Protections and Issuance Guidelines
Clarifying consumer protections: The regulations highlight the conditions for issuing credit cards, emphasizing SAMA’s focus on transparency and responsible lending.
Aligning with new guidelines: Instructions regarding card issuance, activation, fee notifications, and transaction limits directly reflect a new framework designed to standardize and protect credit card holders.
Completing the customer experience: While addressing fees and benefits is crucial, this section also discusses expectations throughout the customer journey, from application to receiving payment notifications and statements.
Policy-driven benefits: This segment adds reliability and inclusivity, especially for financial or regulatory reporting.
