AT least 24 percent of borrowers in Saudi Arabia have fallen behind on repayments, according to the Saudi Credit Bureau (SIMAH). The possible bad debt affects 200 financing institutions across the Kingdom, 85 in Riyadh alone, said Nabil Al-Mubarak, chairman of SIMAH. Most of these financing institutions are not registered with SIMAH, but they are monitored by the Ministry of Commerce and Industry, he said. SIMAH is the Kingdom's first comprehensive consumer credit bureau, grouping 10 commercial banks. The bureau gathers information on how consumers use credit, for members to make improved lending decisions. The volume of consumer credit in Saudi Arabia fell to SR178.9 billion by mid- 2008 from SR185.4 billion a year earlier, after SAMA restricted consumer credit reportedly because consumer loans were being used for speculative trading on the stock market. Al-Mubarak said financing institutions not registered with SIMAH and the Saudi Arabian Monetary Agency (SAMA) do not follow SAMA's financial regulations, including its interest rate. He did not rule out the possibility of unregistered financial institutions being involved in money laundering operations.
