Saudi Central Bank bans promissory notes in credit card financing

Saudi Arabia’s central bank has moved to end the use of promissory notes in credit card financing, ordering all banks and finance companies in the Kingdom to withdraw the documents from existing customers and discontinue the practice for new card issuances.

The Saudi Central Bank (SAMA) said lenders must cancel all promissory notes previously tied to credit card products by 2/1/1448 AH (June 17, 2026). Institutions have also been instructed not to request any form of commercial paper from individuals when offering new credit cards.

The regulator said its decision follows supervisory reviews that identified a rise in the use of promissory notes as part of personal credit card arrangements, prompting concerns over consumer protection.

Banks and finance companies have been given 30 days to submit remediation plans to the central bank detailing how they will resolve outstanding cases. These plans must include clear mechanisms for cancelling or returning any promissory notes already obtained from customers.

SAMA has also directed lenders to revise their internal frameworks, including policies, procedures and control systems, to reflect the new requirements. All corrective actions must be fully implemented within six months from the issuance of the directive.

The central bank said the measures are intended to reinforce customer rights and regulate credit card practices in the retail lending market.