SADAD


THe SADAD payment system was established by the Saudi Arabian Monetary Agency to be the national electronic bill presentment and payment service provider for the Kingdom of Saudi Arabia. The core mandate for SADAD is to facilitate and streamline bill payment transactions of end consumers through all channels of the Kingdom’s Banks. SADAD was launched on October 3, 2004.
SADAD links the commercial sector and local banks, offering the ability to collect customer payments electronically through all the banking channels in the kingdom 24 hours a day.

History and background

SAMA mandated that all banks must accept bill payments at their branches from anyone. The payer does not have to be a customer of the bank. Pre-SADAD economics of bill payment placed an unduly large burden on banks; it was inefficient and slow. Banks recovered a small portion of the cost through keeping the collected money for varying periods of 7–30 days after the bill was paid.
Approximately 60-70% of bills were paid in cash at bank branches. Due to the high number of bills generated in the Kingdom, this results in high costs for banks in front office, payment processing, IT integration and reconciliation. In addition, consumers queue for a long time at banks’ front office desks before paying their bills. Bill presentment and collection is largely manual and paper-based creating significant inefficiencies and overheads for billers and banks.
Large billers formed bilateral agreements with banks in order to enhance bill payments collection. This enabled consumers to use their bank channels to view and pay bills. It required every biller to connect to the twelve different banks operating in KSA and from banks to connect separately to every biller they are under contract with.
SAMA chose to integrate these connections through SADAD, which is a single platform that links different billers and banks to enable consumers to use the electronic channels of any bank. SADAD is now facilitating the payment of high-volume periodic bills and customer initiated payments, such as traffic fines.

How SADAD works

  1. Billers send summary bills information to SADAD at a pre-determined schedule
  2. SADAD validates data received and uploads it into its database
  3. SADAD notifies billers of any discrepancies
  4. Customer requests bill information through bank channels
  5. The bank forwards the request received to SADAD
  6. SADAD retrieves bill information from its database and forwards it to customer
  7. Customer selects the bills to be paid and the respective amounts
  8. The bank debits the customer account and confirms the transaction
  9. SADAD updates its database based on the bank’s confirmation
  10. SADAD notifies relevant billers accordingly
  11. At the end of the day, billers receive reconciliation reports from SADAD showing a breakdown of all transactions processed by SADAD
  12. At the end of the day, SADAD initiates settlement instructions through SARIE
  13. SADAD updates bills status to 'settled'

    Connected billers

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