Saudi Arabia’s Central Bank unveiled its draft rules and regulations to protect and serve the interests of customers of banks and other financial institutions. SAMA called on stakeholders, specialists and the public to present their suggestions and observations on the draft by visiting the Public Consultation Platform (istitlaa) affiliated to the National Competitiveness Center. Those interested have to provide their input on the draft within 30 days so as to enable SAMA to assess its relevance before finalizing the text. The draft is available on the Public Consultation Platform through the link: https://istitlaa.ncc.gov.sa/ar/Finance/SAMA/PrinciplesandRulesfor/Pages/default.aspx This initiative is part of SAMA"s ongoing efforts to preserve the rights of consumers in getting fair and transparent treatment in financial services, commensurate with global best practices in this regard. The Central Bank has identified a number of principles that banks and other financial institutions must abide by when dealing with customers. They are asked to deal with customers fairly, honestly and equitably, as well as to take care of them, especially those with low income and education, the elderly and people with special needs of both genders. Financial institutions were also obligated to protect the privacy of information and data, as well as to protect the customer from fraud. SAMA directed them to enforce technical and control systems to limit and detect fraud, embezzlement or misuse and take the necessary action if they occur. The draft seeks financial institution to provide the best products, services and prices to meet the customer’s needs and desires, in addition to addressing the customer’s complaint, and setting policies that help detect potential conflicts of interest. Avoid fraud, deception The Central Bank urged financial institutions to encourage customers to read contracts, their appendices and any other document that requires the customer’s approval or signature to provide information to customers clearly and accurately, and to avoid misinformation, fraud and deception. The financial firms must also include all the terms and conditions in the application form for obtaining the product or service, provided that the warning statements include the possible consequences when using the product or service other than what was agreed upon, as well as informing the customer of any change that occurs before a period of no less than 30 days from the entry into force of this change. The Central Bank also prohibits financial institutions from requesting the customer’s signature on any blank document or complete data of the incomplete document, and they must protect and preserve clients’ documents and signatures. No change in fees and commissions The general rules of conduct stipulate that the financial institution must not make any change with an increase in fees and commissions that natural customers must pay after obtaining the service or product and signing the contract or agreement or the like. There will be an exemption in the fees and commissions related to the third party provided that it is related to the customer’s use of the financed asset, and the customer must be notified of this when concluding the contract, and the financial institution must put the list of fees and commissions in a clear place on its building and branches as well as on its websites. The financing bodies are obligated not to exceed the fees, commissions and costs of administrative services that they obtain from the natural customer, the equivalent of one percent of the financing amount or SR5,000, whichever is less. It may be deducted only after signing the contract, with the exception of real estate appraisal fees, which may be deducted after the customer obtains the initial approval to grant real estate financing. The Central Bank instructed that the financial institutions explain to customers all the information, services and products provided to them clearly and transparently. These shall include information regarding prices, commissions, fines, types of risks and benefits, and the rights and duties of the customer. Compensation for customer SAMA stressed that the financial institution must ensure that all electronic channels are available intact and in a safe manner. In the event of customers incurring any direct loss as a result of hacking of these channels or due to security breach, they must be compensated for any resulting losses. Financial institutions have also committed to apply more than one standard for identity verification when accessing electronic services, taking the necessary measures to reduce electronic fraud, and including the purpose for which text messages containing the verification code were sent to customers. The Central Bank stressed that the financial institution not to benefit from any returned amounts that may arise due to an error or a technical malfunction. It also directed the need to return the amounts to the affected customer without delay, and other customers who were exposed to the same error within five working days and without waiting for a claim, in addition to repairing the defect or malfunction. The financial firms have also to inform the affected customers about the error and the corrective measures taken through one of the documented channels, and announcing this through all available channels. Handling customer complaints The draft stipulated that the financial institutions should provide multiple channels to receive complaints, inquiries and requests so as to enable customers to submit complaints according to their preference in ease and at their convenience. These channels may include toll free number, branches or website, smart phone applications, and e-mail. It must also put the complaints handling mechanism in a conspicuous place in the building of the financial institution and its branches. In the event that the customer is not satisfied with the outcome of the treatment of his complaint and wishes to escalate the complaint, he must be provided with the mechanism to approach the higher authorities within the financial institution or direct to the competent authority in accordance with his preference. It also obligated the financial institution, whether banks or insurance companies, to provide a free phone number that customers can contact from inside or outside the Kingdom to submit complaints and inquiries, provided that the toll free number is published on the home page of the financial institution’s website clearly for the client in addition to all other channels. The Central Bank stressed that the financial institution should take into account humanitarian cases when dealing with customers who have emergency financial difficulties and find appropriate solutions for them before starting to take legal measures against them. It also stressed the financial institution and its employees not to discriminate between its clients in an unfair manner based on race, gender, religion, color, age, disability or marital status. Mandatory banking regulations The draft stipulates that banks, money exchanges, payment service companies, and firms issuing credit and debit cards have to assure their business customers not to pass or impose additional fees on holders of credit cards and Mada cards when paying through point-of-sale devices, operations through payment service providers and e-commerce websites. It also directed banks, money exchanges and payment service companies to set the upper limit for transfers, daily withdrawals, point-of-sale operations, online purchases, and payment operations. They have to notify customers of this limit when they obtain the service, and to review it at least once a year. Banks and other firms are also obligated to inform customers of the cash withdrawal limit and fees for withdrawals through technical devices and systems such as exchange machines, and not to calculate the annual fees for credit or monthly discount cards until after they are activated by the customer, and the card issuer has the right to cancel the card if it is not activated within 90 days of the date of issuance. Money transfer regulations The regulations also included that the firm receiving the transfer ensures that the beneficiary’s name matches the IBAN number, and that the transfer amount shall be returned to the issuing authority in case there is a difference between them. The draft also stipulates that all the customer data recorded in the transfer form shall be verified, and notify the customer before agreeing to carry out the transfer process within the expected date of the arrival of the transfer amount to the transferee, as well as the amount of fees and commissions, including fees imposed by the third party, if any, and their details, along with the net amount that will be received by the transferee.