IFFE Individual Finance Complete Review Guide 2026–2027

4. The curriculum’s eight operating standards form one workflow: include all parties; protect customers’ interests; preserve documentary evidence; verify creditworthiness; use consistent models; remove contractual uncertainty; calculate APR; and comply with rules. Coverage includes applicants, borrowers, staff and relevant outsourced valuers or collectors. “Partner customer” expresses a shared interest in a sound relationship, not share ownership or a guarantee of the customer’s profits. Obtain written disclosure of other debts, retain reliable records and use an expense model reflecting dependants, housing, education, health, transport, insurance and expected costs. A model supports judgment; it does not replace verified data.
5. Disclosure explains price and consequences before commitment. The May 2025 curriculum describes a clear one-page summary with evidence of receipt, warning statements, 30 calendar days' notice for the agreement changes it discusses, and a monthly statement three weeks before the due date. These are textbook-version statements: the 2025 credit-card rules require statements at least 25 calendar days before payment is due. In the current implementing regulation, Article 82 lists 22 contract-information entries, Article 83 requires a clear documented summary, and Article 84 requires at least 60 calendar days' written notice of a contractually permitted term-cost change. Keep the instrument, product and deadline separate. Accurate marketing and meaningful price comparisons remain necessary; card payoff time, a mortgage follow-on rate and a lease residual value answer different questions.
6. APR compares the timing and full unavoidable cost of finance. It is the discount rate equating the present value of amounts made available with repayments and required costs; it is not a flat profit quote or a price ceiling. Include required administrative charges and mandatory related costs; exclude breach-related charges from this calculation. In the curriculum’s equal-month exercise, a 1% effective monthly rate gives (1.01)^12 − 1 = 12.68%, not 12%; 0.49% gives about 6.04%. Those are stated mathematical exercises. The specific APR rules use actual cash-flow timing and a 365-day year, so do not turn the textbook’s equal-month simplification or equal-instalment example into a universal rule for every product.
7. Separate principal, administrative fees and early-settlement compensation. The current tariff distinguishes mortgage fees, capped at min(1% of finance, SAR 5,000), from non-mortgage fees, capped at min(0.5%, SAR 2,500); these ceilings exclude applicable VAT. For non-mortgage finance, SAR 240,000 gives a ceiling of SAR 1,200 and SAR 700,000 gives SAR 2,500. The textbook's older generic 1%/5,000 calculation must not replace that distinction. Under current Article 88, early repayment removes term cost for the remaining period. Permitted reinvestment compensation cannot exceed the next three months' term cost on a declining balance, plus qualifying contractual irrecoverable third-party expenses. Costs of SAR 350, 340 and 330 give a reinvestment ceiling of SAR 1,020, not three whole instalments. A mortgage contract may separately restrict early payment for no more than two years from contract conclusion.
8. Compliance is a continuing independent control function. The curriculum describes identification, assessment, advice, monitoring and reporting of non-compliance risk. The board approves the compliance policy; compliance maintains a map of obligations by department and product, supports staff training, prepares AML/CFT procedures and reports violations promptly to SAMA and the audit committee. Credit staff still make credit decisions, operations collect payments, and internal audit assesses controls. Sales volume alone is not an adequate incentive measure. Confidentiality duties continue after staff leave; sharing a customer list with a new employer is not justified by resignation. Authorised regulatory reporting is distinct from unauthorised disclosure.
9. Read prohibitions together with their exceptions. The amended Law's Article 11 preserves specified SAMA-approval routes for non-finance activities or ownership; permission for one activity does not authorise unrelated trading. Current implementing-regulation Articles 69 and 72 require the stated SAMA non-objection for customer accounts/time deposits and foreign or foreign-currency funding. Article 70 allows securities in financing transactions, approved debt instruments, hedging existing term-cost or currency exposures, debt settlement, and other cases SAMA determines; this is different from unrestricted speculation. Article 65 permits unsecured finance under its credit-history and related-party conditions, with an ordinary aggregate ceiling of SAR 100,000 per beneficiary and SAMA's express power to raise that amount. Neither the ordinary ceiling nor a permission exception removes the remaining conditions.
10. Related-party controls prevent influence from replacing sound credit judgment. Current implementing-regulation Article 60 covers specified ownership/control interests of 5%, board members, senior management and defined relatives. Where exposure is otherwise permitted, finance must be on a commercial basis and no more than 60% of collateral value; amounts above SAR 500,000 require unanimous governing-body approval. Exposure to one related party at 10% or more of paid-up capital and reserves needs SAMA non-objection; total related-party exposures may not exceed 50% of paid-up capital and reserves. Exposure is prohibited if the related party owns at least 25% of the finance company's shares or voting rights, or controls it; the same prohibition applies if the finance company owns at least 25% of the related party's shares or voting rights, or controls that party. A collateral value of SAR 400,000 supports at most SAR 240,000 under the 60% test. The denominators differ, and statutory prohibitions, collateral qualifications, approved employee programmes and the separate debt-crowdfunding rules still matter.
11. Affordability begins with verified income, existing debts and realistic living costs. Use employer-documented salary and, under the Principles, half the verified monthly average of other periodic income. For example, SAR 10,000 salary plus SAR 4,000 documented rent gives SAR 12,000 counted income, not SAR 14,000. Citizen Account and social-security subsidies are excluded; specified documented housing support may count for real-estate products. Count employer, government-lender and family debts as well as bureau-recorded debt. A card contributes its minimum repayment calculated on the credit limit; unequal or balloon instalments use their monthly average. Variable-cost finance needs an assessment buffer; if later cost changes breach ratios, the prescribed rescheduling responsibility lies with the financier.
12. Apply the correct ratio to the correct base. Salary-linked deductions are capped at 33.33% of gross salary for employees and 25% for retirees in all three income bands. For total monthly income up to SAR 15,000, non-mortgage obligations have a 45% ceiling and all obligations a 55% ceiling, with the specified supported-mortgage case reaching 65%. Above SAR 15,000 but below SAR 25,000, the non-mortgage ceiling remains 45% and total ceiling is 65%. At SAR 25,000 or more, total obligations follow credit policy plus affordability assessment; salary deduction limits remain. A SAR 12,000 salary gives about SAR 4,000 salary deduction, while an SAR 8,000 pension gives SAR 2,000. Passing a percentage ceiling never alone proves affordability. The stated 60-month tenor excludes real-estate finance and credit cards.
13. Collection is controlled communication, not pressure on unrelated people. In the curriculum’s 2018 framework, use documented email, registered mail, national address, SMS or calls; identify the employee and creditor, verify the recipient, disclose recording and allow a return call. It teaches at most ten call attempts per thirty days and records kept for at least ten years. Never reveal debt through labelled envelopes or contact an unrelated employer or neighbour. If the amount is disputed, record a complaint, state the handling period and pause arrears reminders until resolution. Audit and compliance oversee the process. The 2025 replacement retains core privacy safeguards, adds channels and defines its ten-call limit per financing product; keep those version details separate.
14. For deductions and hardship, distinguish the curriculum’s archived procedure from current operation. The 2018 text prevents premature or repeated deductions without the stated authority and requires cost-free extension where the creditor caused the missed deduction. It teaches rescheduling within 30 days after documents for qualifying involuntary or voluntary changes, with different term-cost treatment and an asset-backed exception. Its legal-action passage says more than three consecutive months or five separate months and a final national-address contact. Its death/total-disability relief has contract-date conditions and exceptions; it is not an unconditional waiver for every death. The 2025 replacement changes rescheduling to 20 working days, uses different voluntary-change wording and revises default and deduction details. Use the named version for an exam question; live cases require the governing current text.

Common mistakes in this chapter

• ✕ Always pair an article number with its instrument: the Law’s Articles 3 and 10 are not the Implementing Regulation’s Article 3.
• ✕ A historical rule in a 2025 textbook may already have been replaced. The textbook publication date does not make every quoted procedure current.
• ✕ A salary deduction percentage, a non-mortgage ratio and an all-debt ratio have different bases and purposes.
• ✕ APR includes unavoidable costs and cash-flow timing; monthly rate × 12 is not the stated effective annual conversion.
• ✕ A regulatory permission exception matters: “prohibited unless approved” differs from “never permitted”.
• ✕ The early-settlement reinvestment ceiling uses three months of declining term cost, not three full instalments or all future profit.
• ✕ A complaint pauses specified reminders, not the existence of the debt. Death relief also requires its conditions and exceptions to be checked.