Credit card: what paying only the minimum costs (Saudi Arabia)
Updated
Example: SAR 7,000 on a card at 36% a year (an example rate — there is no official cap), no new spending. SAMA requires the minimum to be at least 5% of the amount due. If your card's minimum is 5% with "at least SAR 100" and you pay only that, the card takes 7 years 5 months to clear and costs SAR 8,072 in term cost (profit) — more than you borrowed. Paying the first minimum, SAR 360.50, every month instead clears it in 2 years 6 months for SAR 3,655. Your card's rate and minimum are on your statement.
Minimum only, year by year
Not a valid document. Estimate for information only — not financial advice, not an offer of credit and not a bank document. Errors are possible. Only your bank's or finance company's official offer letter, contract and statements are binding.
Why the minimum is a trap
The minimum is a share of what you owe. As the balance shrinks, so does the minimum, so each month you pay a little less and the debt drags on. Early on, most of the minimum is term cost. With only the 5% rule and no "at least SAR" floor, the same SAR 7,000 would take 54 years 4 months. With a fixed amount every month instead — even just your first minimum, kept the same — the balance falls faster and the term cost drops with it.
What SAMA's credit card rules say
- Minimum at least 5%. The minimum payment may not be set below 5% of the amount due. There is no official minimum in riyals and no cap on the card's term cost rate — only on fees.
- Your statement must show it. Every statement must show how long a balance such as SAR 7,000 takes to clear paying only the minimum, and what it costs.
- Pay in full, pay no term cost. Term cost is charged only on what is left unpaid after the grace period. You get at least 25 days from the statement date before a late fee can be charged.
- Late fee: at most SAR 50 + VAT. The issuer may not raise your term cost rate because you paid late or defaulted. Once the minimum has not been paid for more than 90 days in a row, the card is in default.
- Cash costs more. Buying with the card locally or online has no transaction fee. A cash withdrawal or transfer to your account costs at most 3% (capped at SAR 75), and cash may not exceed 30% of your limit. Purchases abroad or in foreign currency cost at most 2%.
Your cards count against your salary
In Saudi Arabia every credit card counts as a monthly payment equal to the minimum on its full limit — used or not — in the one-third salary limit and in the income limits for new finance. A large unused limit can reduce what you may borrow: see how much can I borrow?. To move a large balance to fixed instalments, compare with the personal finance calculator. To see how much credit limit the rules leave room for, use the credit card limit calculator.
Questions people ask
What is the minimum payment on a Saudi credit card?
SAMA's rules say it may not be set below 5% of the amount due. Your issuer may set a higher minimum or an 'at least SAR' amount — check your card's terms and statement.
Is there a cap on credit card rates in Saudi Arabia?
No — SAMA caps card fees (late fee, cash withdrawal, foreign purchases) but not the term cost (profit) rate itself.
When is term cost charged on a credit card?
In Saudi Arabia, only on the amount left unpaid after the grace period. Pay the full statement balance by the due date and no term cost is charged.
How much is the late fee?
At most SAR 50 plus VAT, and the issuer may not raise your rate because you paid late, in Saudi Arabia.
Do credit cards affect how much I can borrow?
Yes — in Saudi Arabia, each card counts as a monthly payment equal to the minimum on its full limit, used or not, in the one-third salary limit and the income limits.