Saudi Arabia launches "Sah" individual savings product, with a 5.64% payout rate

On February 4, Saudi Arabia launched the Sah, the first Shariah-compliant, government-backed savings product for individuals.

This initiative is part of the Financial Sector Development Program, aligned with the Kingdom's Vision 2030 programs. Sah aims to boost individual savings by encouraging periodic income deductions and promoting financial planning for the future.

Sah offers lucrative returns on a monthly basis, with a fixed one-year saving period and disbursed yields at the sukuk's term end. The Saudi Ministry of Finance and the National Debt Management Center (NDMC) jointly introduced Sah, designed for Saudi citizens over 18 holding accounts with specified financial institutions.

The subscription period for the inaugural issue, with a payout rate of 5.64 percent, concludes on February 6. The allocation is scheduled for February 13, and redemption is set for February 18–21, with payments made on February 25.

Answering queries, the NDMC clarified that Sah is the first subsidized savings product for individuals compliant with Islamic Shariah, issued through the Ministry of Finance. Sah's advantages include Shariah compliance, annual returns, easy subscription, no subscriber fees, and unrestricted redemption.

Sah bonds, with a nominal value of SR1000, will be issued through participating financial institutions. The minimum subscription is SR1000, and the maximum limit is SR200,000 per individual during the program period. Annual profits are paid on the maturity date, with a low risk ratio associated with Sah subscriptions.

The return percentage varies based on monthly market conditions, and trading Sah bonds in the financial market is not possible. Subscription occurs through participating financial institutions without the need for a special application. Sukuk holders can request redemption according to the published annual calendar, with no accrued profits upon early withdrawal.

Importantly, Sah product holders are exempt from zakat payments. This groundbreaking savings product aligns with the Kingdom's economic diversification goals and emphasizes financial planning and increased savings rates among its citizens.

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