Credit Score
Synonyms: Credit Rating (individual)، SIMAH Score، Creditworthiness Score
Last updated: 2026-09-25
Short Definition
A credit score is a statistical number calculated by a credit bureau from an individual's credit record, expressing the likelihood that he will repay in the future, and lenders use it as one of the factors in deciding whether to grant finance and on what terms.
Overview
Legal Basis
Credit scores and reports are governed by the Credit Information Law issued by Royal Decree No. M/37 dated 5/7/1429H and its Implementing Regulations, which require the consumer's written consent before an inquiry (Articles 39 and 40), give the consumer a free copy of his record in cases including the first request and after an adverse decision (Article 43), and a right to object, which the bureau investigates free of charge within 30 business days (Article 46). Article 13 of the Implementing Regulation of the Real Estate Finance Law requires the lender to review the credit record with the consumer's consent and to reject the application without it.
Practical Example
Two colleagues, each earning SAR 16,000, apply to the same bank for SAR 800,000 of home finance. The first has paid his credit card and car installment on time for six years and uses about a quarter of his card limit, so his score is high and he is approved at the standard rate. The second has repeated late card payments over the last two years, made five finance applications within a few months and uses almost his entire card limit, so his score is lower; the bank asks him to pay down part of the card balance first and then approves a smaller amount. Despite identical income and deduction ratios, credit behaviour produced two different outcomes.
Common Mistakes
- ✗Believing a high score guarantees approval, when deduction limits, LTV and lender policy apply regardless.
- ✗Submitting several finance applications in a short period, as the number of inquiring entities in the previous two years is recorded.
- ✗Neglecting small overdue bills with bureau member companies, which may appear in the record.
- ✗Not reviewing the record before applying, although the law allows a free copy in cases including the first request.
- ✗Thinking the score resets as soon as a defaulted debt is paid, when negative information can remain for a set period after settlement.
International Differences
In the US the FICO score (300 to 850) is the best-known standard, with three major credit bureaus. In the UK each bureau uses its own scale. In the UAE scores are issued by the Al Etihad Credit Bureau, in Turkey the Credit Registration Bureau (KKB) issues the Findeks score, and in Egypt I-Score issues them. Saudi Arabia stands out for a law requiring written consent before inquiries and setting statutory periods for retaining negative information and investigating objections.
