Customer Credit Agreement Template for Saudi Arabia

The Customer Credit Agreement is essential for financial institutions operating in Saudi Arabia to document credit facilities provided to customers. This agreement is specifically designed to comply with Saudi Arabian law, including Sharia principles and SAMA regulations, making it suitable for both retail and corporate customers seeking credit facilities. The document includes comprehensive details about the credit facility, profit calculations (structured to avoid conventional interest), payment terms, security arrangements, and customer obligations. It's particularly important in the Saudi Arabian context where all financial transactions must comply with Islamic finance principles while meeting regulatory requirements for consumer protection and banking operations. The agreement serves as the primary document governing the credit relationship between the financial institution and the customer, incorporating all necessary provisions for enforceability under Saudi law.

1. Parties: Identification of the credit provider and the customer, including full legal names and addresses

2. Background: Context of the agreement and confirmation of Sharia compliance

3. Definitions: Definitions of key terms used throughout the agreement

4. Facility Details: Description of the credit facility, amount, purpose, and profit rate (avoiding interest-based terminology)

5. Conditions Precedent: Conditions that must be satisfied before the facility becomes available

6. Payment Terms: Payment schedule, method of payment, and calculation of profit

7. Customer Representations and Warranties: Customer's confirmations regarding their financial status, legal capacity, and accuracy of provided information

8. Customer Covenants: Ongoing obligations of the customer during the term of the agreement

9. Events of Default: Circumstances constituting default and consequences

10. Security: Details of any security or collateral provided

11. Fees and Charges: Breakdown of all applicable fees and charges (Sharia-compliant)

12. Term and Termination: Duration of the agreement and termination provisions

13. General Provisions: Standard legal provisions including notices, amendments, and governing law