The number of bad checks issued during the second quarter of the year was 56 percent less than the number of bad checks issued in the same period 2010. While 13,000 checks bounced in the second quarter of the current year, 29,000 checks bounced in the same period 2010, the annual report of the Saudi Credit Information Company (SIMAH) read.

The actual value of bad checks in the second quarter of 2011 is put at SR1.12 billion, while the value of bad checks in 2010 in the same period was SR2.78 billion, registering a 60 percent fall, according to the report, quoted by business daily Al-Eqtisadiah.

The report added that the number of bad checks issued by individuals had fallen by 55 percent from 11,208 in 2010 to 5,043 in 2011.

The value of the checks in the second half of 2011 fell by 63 percent to reach SR45,967 million from SR1.22 billion in the same period the previous year. The number of bad checks issued by companies fell by 56 percent, from 18,754 in 2010 to 8,240 in the same period 2011.

Some of the local banks achieved 95 percent success in handling bad checks, according to the report.

“The findings are encouraging, as it clearly shows the phenomenon of issuing bad checks is receding. However, I do not believe that the phenomenon will stop completely,” SIMAH General Manager Nabeel Al-Mubarak said.

He attributed the drop in bad checks to a decision of the Council of Ministers in 2009 to criminalize the act and introduce punishments including prison time and public defamation in local media in addition to authorizing the Prosecution and Investigation Commission to take legal action against check-related offenders.

He said another contributing factor was that the government had ordered the concerned authorities to issue decisions in cases involving bad checks within 30 days of receiving complaints.