A Saudi individual may lend their own money to a relative, but regular lending and debt crowdfunding fall under the central bank (SAMA), and interest stipulated between individuals in principle runs up against the prohibition of riba.
Three ways to finance an individual in the Kingdom
The Saudi market distinguishes qard, a one-off loan between relatives, financing from a licensed bank or finance company, and debt crowdfunding arranged by a platform. Only the last two categories require a licence issued by SAMA, the national regulator.
SAMA, the central authority for credit and crowdlending
The Saudi Central Bank, known by the acronym SAMA, supervises finance companies and publishes dedicated rules on debt crowdfunding. A company applying for this licence must, among other things, show minimum capital of five million Saudi riyals.
Riba and the benevolent loan under Saudi law
The Saudi legal system rests on sharia, which prohibits riba. A loan between individuals therefore takes the form of a qard hasan, with no interest. Bank products rely on murabaha or tawarruq; our page on halal lending between individuals explains these mechanisms.
The Civil Transactions Law in force since late 2023
Enacted by Royal Decree M/191, the Civil Transactions Law has applied since 16 December 2023. It codifies how contracts are formed and performed. For a family loan, it makes a precise, dated document signed by both parties all the more valuable.
Electronic promissory notes on the Nafith platform
The Ministry of Justice set up Nafith, a platform for issuing electronic promissory notes, known as sanad lamr. The debtor approves the note through the unified national access system, and if it goes unpaid the file links directly to the enforcement court.
Licensed crowdlending platforms and who they lend to
Platforms such as Lendo or Raqamyah, named in our sources, mainly fund small and medium-sized Saudi businesses rather than consumer needs. Before investing, check on the SAMA website that the company is listed among the authorised debt crowdfunding entities.
Expatriates on an iqama: a specific risk for lenders
Nearly four residents in ten are foreign nationals. An employee holding an iqama who obtains a final exit visa can leave the country with an unpaid debt. A careful lender insists on a Nafith note and reads our guide to lending to expatriates.
SIMAH records and borrowers' credit history
The Saudi Credit Bureau, called SIMAH, centralises bank loans and payment defaults. A borrower flagged by SIMAH sometimes turns to private lenders found on social media, which exposes them to highly targeted fraudulent offers promising easy money.
Fake lenders on WhatsApp posing as SAMA
Fraudsters present themselves as finance companies, demand processing fees in riyals and sometimes copy the SAMA or Absher logo in their messages. No licensed entity requires an upfront payment by gift card or crypto-asset before releasing funds.
Reporting fraud through Absher, Kollona Amn and SAMA Cares
A scam can be reported through the Absher cybercrime service, the Kollona Amn app or the national portal. A complaint against a bank goes first to the institution, then to SAMA Cares. See also our method to report a loan scam.
Tax: no personal income tax in the Kingdom
The Kingdom levies no income tax on resident individuals; zakat and corporate tax, managed by ZATCA, apply to businesses. A lender domiciled in France or Belgium nevertheless remains taxable at home on any interest earned from a Saudi borrower.
Cross-border money flows and authorised channels
Foreign workers send considerable sums to their home countries every year. Transfers go through banks and licensed exchange companies; informal hawala networks expose users to prosecution and leave the lender without any usable evidence of payment.
Arranging a compliant private loan in Saudi Arabia
- Decide whether the deal remains a one-off loan between relatives or amounts to financing activity requiring a SAMA licence.
- Draft a loan contract in Arabic, translated if needed, stating the amount in riyals, the term, the schedule and the absence of interest.
- Have an electronic promissory note issued on Nafith and approved by the borrower through the unified national access system.
- Transfer the sum from an identified Saudi bank account, never in cash or through an informal intermediary.
- Keep the statements and track each monthly repayment with a written receipt signed by the lender.
- If approached by a suspicious contact, check the licence on the SAMA website and report it via Absher or Kollona Amn.
Indicative costs of a private loan in Saudi riyals
| Item | Indicative amount | Comment |
|---|---|---|
| Interest between individuals | 0 SAR in principle | Riba prohibited; a margin is possible only through a regulated Islamic contract |
| Crowdlending platform fees | Varies by platform | Stated in the licensed platform's terms |
| Nafith promissory note | Low or nil, indicative | Check the fee scale shown on the platform |
| Tax on interest in the Kingdom | No personal income tax | May be taxed in the lender's country of residence |
| Fees demanded by a fake lender | Several thousand SAR | Almost always lost once the transfer is made |
Documents to gather before signing
- Valid national ID card or iqama
- Salary certificate or income statement from the employer
- Signed loan contract in Arabic
- Nafith electronic promissory note
- Saudi IBAN of both parties
- Dated repayment schedule
- Bank proof of the initial transfer
Common traps in Saudi private lending
- Paying insurance or processing fees to a lender reached on WhatsApp or Snapchat who promises instant financing with no SIMAH check.
- Lending a large sum to an expatriate colleague without a Nafith note, then discovering they have left the Kingdom for good.
- Believing that a message bearing the SAMA or Absher logo proves a private lender is licensed.
- Stipulating monthly interest in a simple acknowledgement of debt, a clause a Saudi judge is likely to set aside.
- Handing money to an unauthorised hawala transfer network to repay a lender who lives outside the Kingdom.
Your questions on private loans in Saudi Arabia
Can an individual lend with interest in Saudi Arabia?
Saudi law, founded on sharia, prohibits riba. A loan between individuals in principle takes the form of an interest-free qard. Margins exist only in Islamic contracts structured by licensed institutions. Have any arrangement checked by a lawyer registered with the Saudi bar.
Who supervises Saudi debt crowdfunding platforms?
SAMA issues debt crowdfunding licences and sets the capital and governance requirements. The CMA, the capital markets authority, supervises equity crowdfunding instead. Always check the official list before handing over any money.
How can you secure a loan to a friend living in Riyadh or Jeddah?
Draw up a written contract, have a promissory note issued on Nafith and pay the sum by bank transfer. If the debt goes unpaid, the note can be presented to the enforcement court, which avoids lengthy ordinary proceedings.
Where should you complain after an online loan scam?
File a cybercrime report via Absher, Kollona Amn or the national portal, warn your bank immediately to try to block the payment, then contact SAMA Cares if the bank does not respond. In an emergency, call 911.