Regulatory Alerts2025-06-04
Emphasis on Exercising Due Diligence when Verifying Customer Income Prior to Granting Finance
The Saudi Central Bank issued this circular to require all financing companies operating in the Kingdom to exercise due diligence when verifying customer income prior to granting finance. The directive mandates that institutions assess potential risks, authenticate supporting income documents, and strengthen internal verification procedures in compliance with the Financing Companies Control System and its Executive Regulations. Compliance is mandatory for all licensed financing entities to maintain sector stability and regulatory alignment.
Saudi Central Bank
Reference No.: 10698605 Date: 1446/12/08 AH Attachments: None
Circular
To the Esteemed, Peace, mercy, and blessings of God be upon you,
Subject: Emphasis on Exercising Due Diligence when Verifying Customer Income Prior to Granting Finance.
Based on the authorities vested in the Saudi Central Bank under the Financing Companies Control System issued by Royal Decree No. (M/51) dated 1433/08/13 AH, and its Executive Regulations issued by the Governor's Decision No. (2/M Sh T) dated 1434/04/14 AH, including its authority to regulate and supervise the financing sector, and to take necessary measures to safeguard its integrity and stability.
Accordingly, the Saudi Central Bank wishes to emphasize to all financing companies the importance of exercising due diligence prior to granting finance, commensurate with potential risks, and verifying the authenticity of documents submitted by customers to prove their income, while enhancing related procedures in compliance with applicable regulations and directives.
For your information and compliance.
Yours sincerely,
Yousef bin Ahmed Al Sheikh Deputy Governor for Supervision
Distribution Scope:
- Financing companies operating in the Kingdom.