Banks and licensed finance companies operating under the Saudi Central Bank's (SAMA) Finance Companies Control Law need loan agreements, security documentation, and credit facility structures that hold up both commercially and under regulatory review.
This includes drafting and negotiating facility agreements, registering security interests, and advising on SAMA's capital, disclosure, and consumer-protection requirements that apply to licensed lenders. Sharia-compliant structures — murabaha, ijara, sukuk — are handled through our Islamic finance practice.
Businesses taking on a credit facility need the loan's covenants, security package, and default terms reviewed before signing, since these terms determine what happens if the business later needs more flexibility or falls behind on a payment.
Where a lender moves to enforce security or accelerate a facility, this practice represents the borrower in negotiating a resolution or, where needed, defending the enforcement action. Actual collection against a defaulting borrower runs through debt collection and the execution court.
A signed pledge agreement over movable assets — inventory, equipment, receivables — creates an obligation between the parties, but it's registration on the unified movable assets registry that actually perfects the security interest and establishes its priority against other creditors with competing claims to the same collateral.
We check registration status as a routine step in any secured lending matter, on both sides of the transaction, because an unregistered or improperly registered security interest can leave a lender holding what looks like solid collateral on paper but ranks poorly — or not at all — against other creditors when it actually matters.
A SAMA finance company license carries ongoing obligations well beyond the initial approval — minimum capital maintenance, periodic regulatory reporting, and consumer-protection standards that apply to how credit is marketed, disclosed, and collected — obligations that continue for the life of the license, not just at the point of first registration.
We help licensed lenders build compliance into their loan documentation and collections practices from the start, since a facility agreement that's commercially sound but silent on SAMA's disclosure requirements can create regulatory exposure even when the underlying loan itself performs exactly as expected. Digitally-delivered lending and payment models fall under our fintech law practice for SAMA licensing purposes.
Yes — companies extending credit as a regular business activity generally need a SAMA license under the Finance Companies Control Law, distinct from a one-off related-party loan.
Often, yes — many lenders prefer a renegotiated repayment schedule over enforcement action, and we can represent a borrower in that negotiation before a dispute escalates.
Common forms include commercial pledges over movable assets, real estate mortgages, and assignments of receivables, each with specific registration requirements to be enforceable.
Not on its own — registering the pledge on the unified movable assets registry is what perfects the interest and establishes its priority against other creditors, so registration matters as much as the signature.
Minimum capital maintenance, periodic regulatory reporting, and consumer-protection standards around how credit is marketed and collected — these continue for the life of the license, not just at initial approval.
Yes — a facility that performs well commercially can still create regulatory exposure if the documentation or collections practices don't meet SAMA's disclosure and consumer-protection standards.
Expert Riyadh