* Ikrami Abdullah from Riyadh
Saudi Arabia's "personal" consumer loans at the end of last year reached 2018, their highest level, reaching about 339 billion riyals.
These loans last year rose by 2.6 percent, amounting to 8.5 billion riyals, compared to 330.5 billion riyals by the end of 2017, which increased by only 0.4 percent (SR 1.2 billion), compared to 2016.
According to the analysis of the report unit in the newspaper "AlEqtisadiah" that based on SAMA data, consumer loans in 2018 rose for the tenth consecutive year, where it declined in 2008, and then continued annual rises until the end of last year.
Consumer loans rose by 2018 mainly during the third quarter, which rose by 12.1 billion riyals from the previous quarter.
It reached the highest in two and a half years, before applying the principles of responsible finance to individuals on August 12, 2018, scheduled by SAMA.
In 20 years, consumer loans have doubled seven times, reaching 46.1 billion riyals at the end of 1998.
During the 20-year period, consumer loans recorded only a one-year decline in 2008 in conjunction with the global financial crisis, when it fell to 169.3 billion riyals, compared with 174.5 billion riyals at the end of 2007.
Consumer loans include eight main divisions as they are: loans for the restoration and furnishing and improvement of real estate, buying cars and personal transport, buying furniture, durable goods, education, health care, credit card loans, as well as other consumer loan items.
By the end of 2018, loans to renovate, furnish and improve real estate were accounted for 8.3 percent of total consumer loans in Saudi Arabia at a value of SR 28.1 billion.
While loans for cars and personal transport represented about 5 percent, worth about 16.8 billion riyals.
Loans for the purchase of furniture and durable goods were accounted for 3.7 percent of consumer loans, worth 12.5 billion riyals.
Loans for education were accounted for about 1 percent of consumer loans, worth 3.5 billion riyals.
Loans for health care were accounted for about 0.2 per cent of consumer loans that worth 703 million riyals.
While loans for tourism and travel were accounted for 0.02 percent of SR 484 million.
Credit card loans represented about 4.5 percent of consumer loans at a value of about 15.3 billion riyals.
While the lion's share of other consumer loans was 77.2 percent, worth 261.6 billion riyals.
Saudi Arabian Monetary Agency (SAMA) began applying the principles of responsible finance to individuals on August 12.
According to SAMA, these principles aim to encourage responsible financing that meets the actual needs of customers, especially those related to the acquisition of housing and assets instead of consumption purposes, and the enhancement of financial coverage through the provision of appropriate funding for all segments of society and to take into account the tolerance within the scope of the client can afford.
According to the principles, financing is tolerable if the total monthly obligations of the customer after the grant is less than the net monthly income available to the customer.
The net monthly income of the customer is the deduction of the monthly liabilities of the total monthly income of the customer.
The total income of the client includes salary, in addition to 50 per cent of any other sources of income except government subsidies such as "citizen account" or "social security."
The total monthly obligations on the client include credit liabilities, in addition to the basic expenses of "food, housing, education, health, insurance and domestic work."
* Economic Reports Unit