Saudi Arabian banknotes
Banks and financial institutions operating in Saudi Arabia reduced the monthly deduction rate for new personal and mortgage loans to 55% of the total monthly salary for employees earning less than SAR 15,000, compared to the previous rate of 65% that had been in place since 2014, Al-Eqtisadiah newspaper reported citing its sources. 
The sources added that the 55% deduction cap will apply to employees earning below SAR 15,000, regardless of whether the loan is subsidized or unsubsidized.
This move aims to strike a better balance between supporting home financing and ensuring financial sustainability for households, thereby enhancing the quality of life for middle- and low-income segments.
According to data available on Argaam, the principles of responsible lending for individuals stipulate that for customers with a total monthly income of less than SAR 15,000, monthly credit obligations resulting from financing should not exceed 55% of the customer’s total monthly income. However, for customers benefiting from the Ministry of Municipalities and Housing or the Real Estate Development Fund (REDF) under home financing products, the monthly obligations may reach up to 65% of the total income.
Meanwhile, mortgage loans granted by commercial banks in Saudi Arabia to individuals and companies rose by 15% year-on-year (YoY), reaching approximately SAR 932.8 billion by the end of Q2 2025, compared to SAR 814.6 billion at the end of Q2 2024.
Saudi Arabian banknotes
Banks and financial institutions operating in Saudi Arabia reduced the monthly deduction rate for new personal and mortgage loans to 55% of the total monthly salary for employees earning less than SAR 15,000, compared to the previous rate of 65% that had been in place since 2014, Al-Eqtisadiah newspaper reported citing its sources.
The sources added that the 55% deduction cap will apply to employees earning below SAR 15,000, regardless of whether the loan is subsidized or unsubsidized.
This move aims to strike a better balance between supporting home financing and ensuring financial sustainability for households, thereby enhancing the quality of life for middle- and low-income segments.
According to data available on Argaam, the principles of responsible lending for individuals stipulate that for customers with a total monthly income of less than SAR 15,000, monthly credit obligations resulting from financing should not exceed 55% of the customer’s total monthly income. However, for customers benefiting from the Ministry of Municipalities and Housing or the Real Estate Development Fund (REDF) under home financing products, the monthly obligations may reach up to 65% of the total income.
Meanwhile, mortgage loans granted by commercial banks in Saudi Arabia to individuals and companies rose by 15% year-on-year (YoY), reaching approximately SAR 932.8 billion by the end of Q2 2025, compared to SAR 814.6 billion at the end of Q2 2024.
