Using MADA through INTERNET for Buying Products

In the Name of Allah, the Most Gracious, the Most Merciful Saudi Arabian Monetary Authority Head Office

General Department of Payment Systems
Reference No.: 391000075005
Date: 1439/07/02 AH
Attachments: 1

Subject: Enabling Online Purchases via MADA Bank Cards.

Circular

To the Esteemed,
Greetings,

With reference to the five-year strategy of the national payment system "MADA", which includes several pathways, including the growth and expansion pathway. One of its initiatives is enabling payment services via the Internet through MADA bank cards to target new sectors within e-commerce, in alignment with Saudi Arabia's Vision 2030 goals regarding digital transformation.

The Authority has therefore decided to permit all banks to begin activating MADA bank cards for completing online payments, effective from April 1, 2018 CE, subject to the following considerations:

1. Online payment processing for domestic e-commerce merchants shall be handled through the national MADA payment system in accordance with the commercial requirements, rules, and technical specifications shared with banks previously. This shall be completed after finalizing the necessary tests and approvals from the MADA Approvals Center under the General Department of Payment Systems.
2. Online payment processing for cross-border e-commerce merchants shall be handled through international payment companies and systems in accordance with the specific rules and requirements for this purpose.
3. Adoption of the attached pricing schedule for locally executed transactions using MADA bank cards, taking into account any prior agreements signed with e-commerce merchants for accepting electronic payment services.

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Phone: +966 (11) 4662015 Fax: +966 (11) 4662851 P.O. Box: 2992, Riyadh 11169, Kingdom of Saudi Arabia GDPS@SAMA.GOV.SA

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In the Name of Allah, the Most Gracious, the Most Merciful Saudi Arabian Monetary Authority Head Office

General Department of Payment Systems
Reference No.:
Date:
Attachments:
Corresponding Date:

4. Cardholders shall be enabled to control their approved online purchase limits through electronic channels prior to the date mentioned in Circular No. 391000062299 dated 1439/06/02 AH.
5. Continued notification of customers regarding online transactions via SMS, in compliance with Circular No. 381000060893 regarding the transaction type "Online Purchase".

The Authority further expects all banks to actively contribute in the coming period by educating their customers, both individual and e-commerce segments, on how to benefit from the service and how to subscribe, including dedicating specific marketing and awareness campaigns for this purpose.

Yours sincerely,

Ahmed bin Abdullah Al-Sheikh
Deputy Governor for Supervision

Distribution Scope:

• Banks operating in the Kingdom
• Authority departments

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Phone: +966 (11) 4662015 Fax: +966 (11) 4662851 P.O. Box: 2992, Riyadh 11169, Kingdom of Saudi Arabia GDPS@SAMA.GOV.SA

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In the Name of Allah, the Most Gracious, the Most Merciful Saudi Arabian Monetary Authority Head Office

General Department of Payment Systems
Reference No.:
Date:
Attachments:
Corresponding Date:

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

	(1) MADA Switch Fees
Brief Definition	Fees paid by banks to the Authority for e-commerce transactions via MADA cards, consisting of (a) Settlement Fees and (b) Authorization Fees.
Pricing Model
• Authorization Fees	Same as the basic pricing schedule for MADA POS terminal transactions regarding mada debit cards and mada prepaid cards.
• Settlement Fees

	(2) Bank Interchange Fees
Brief Definition	Fees paid between banks, specifically fees paid by the Acquiring Bank to the Issuing Bank for each transaction conducted in the e-commerce environment, calculated based on 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 via MADA cards in the e-commerce environment.
	• No Cap on Bank Interchange Fees.

	(3) Merchant Service Charge (MSC)
Brief Definition	Fees paid by the e-commerce merchant to the Acquiring Bank for each purchase transaction conducted via MADA cards in the e-commerce environment, calculated based on transaction value.
Pricing Model
• Merchant Service Charge (MSC)	• 1.75% as the maximum rate per purchase transaction paid to the Acquiring Bank, where the fee rate is negotiable between the Acquiring Bank and the merchant.
	• No Cap on Merchant Service Fees.

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Phone: +966 (11) 4662015 Fax: +966 (11) 4662851 P.O. Box: 2992, Riyadh 11169, Kingdom of Saudi Arabia GDPS@SAMA.GOV.SA