Saudi Arabia has launched the 10th round of its subscription-based savings product, Sah, for December, offering a competitive return of 4.83 percent.
The initiative, aimed at fostering financial stability and supporting economic growth, is Shariah-compliant and government-backed.
The sukuk opened for subscription on Dec. 1 and will remain available until Dec. 3. Allocations are scheduled for Dec. 10, with redemption from Dec. 15 to 18, and payment due on Dec. 22, according to the National Debt Management Center’s 2024 product issuance calendar.
Organized by the NDMC and issued by the Ministry of Finance, the fee-free savings product offers low-risk returns and is accessible through the digital platforms of approved financial institutions.
Sah is the first savings product in Saudi Arabia specifically designed for individuals, structured as bonds within the Kingdom’s local bonds program and denominated in Saudi riyals.
It aligns with the Financial Sector Development Program under Saudi Vision 2030, which aims to increase the savings rate among residents from 6 percent to the international benchmark of 10 percent by the end of the decade.
The minimum subscription amount is SR1,000 ($266), equivalent to one bond, while the maximum is capped at SR200,000 per user during the program period. The product is exclusive to Saudi nationals aged 18 and above, with returns provided monthly based on the issuance calendar.
The savings period spans one year, offering fixed returns, with accrued yields disbursed at the sukuk’s maturity. Returns for future issuances will be influenced by market conditions.
Eligible individuals must hold accounts with one of five financial institutions: SNB Capital, Aljazira Capital, Alinma Investment, SAB Invest, or Al Rajhi Bank.
The 9th round of Sah, launched on Nov. 3, offered a slightly higher return of 4.89 percent. That issuance closed with total allocations reaching SR3.415 billion ($990 million).
The sukuk issuance for the 9th round was divided into five tranches, each with different maturities. The first tranche, worth SR2.524 billion, will mature in 2029. The second, valued at SR434 million, will mature in 2031. The third tranche, amounting to SR137 million, will mature in 2034. The fourth, totaling SR10 million, will mature in 2036. The fifth tranche, sized at SR310 million, will mature in 2039.
The NDMC has emphasized that the Sah sukuk program is designed to strengthen collaboration with the private sector. Future initiatives will focus on developing customized savings products tailored to different individual categories in partnership with banks, fund managers, fintech companies, and other institutions.
The launch marks a significant step by the Saudi government to promote savings and enhance financial inclusion, ensuring citizens have access to products and services that meet their financial needs.
