Jeddah- Some legal experts underestimated the possibility of aggravating issues related to salaries of Saudi borrowers who are working in the governmental sector through overruns by the banks based on the latest governmental resolutions.
Banking sources affirmed to Asharq al-Awsat that the banks have no other option but to reschedule the personal and real estate loans whose installments’ rate exceeds that determined by the Saudi Arabian Monetary Agency (SAMA).
The sources added that the banks and official funding parties will deal with the added term of the loan according to the new schedule. They continued that SAMA is considering imposing penalties on the banks that breach the regulations of rescheduling for the beneficiaries through exceeding the allowed monthly deduction.
The monthly deduction should not exceed 33.33% of the total borrower’s salary while it should not exceed 25% of the retired salary.
However, the regulations of real estate funding permits deducting 50% of the borrower salary and the rate might also reach up to 60% in some cases.
The banking sources added that banks need up to 30 days, minimum, to carry out any amendments or to reschedule the loans according to the obligations of SAMA.
Dr. Nidal Atah, a lawyer and a legal expert, said that any citizen can file a complaint against the bank before the Ministry of Finance of Saudi Arabia which is represented by SAMA in case the amount discounted from the salary exceeded the permitted rate.
“Necessary procedures will be taken within 60 days from submitting the complaint; the borrower should submit the complaint personally and not any other party else,” added Atah.