Mada system helps increase efficiency, cuts costs: SAMA

JEDDAH: The new electronic payment system, Mada, helps increase efficiency and reduces costs for banks, merchants and customers, besides assisting in countering the smuggling of cash, SAMA Vice Governor Abdulaziz bin Saleh Al-Furaih said here recently.

He said that some traders and shop owners in the Kingdom are viewing Mada as counterproductive to their profits due to the imposition of fees for the benefit of banks, “but this is not the case.”
Speaking to reporters during the inauguration of Mada recently, Al-Furaih said that monitoring over the past six months has revealed that only a limited number of point-of-sale (POS) terminals are in use, although there are almost 180,000 terminals in Saudi Arabia.
He said there must be increased awareness among customers that the presence of these POS terminals in stores is to their overall advantage and that it is their right to use the system wherever they choose to shop.
Al-Furaih said that SAMA’s role is to monitor the sales activities, but not to force traders and shop owners to actually use these terminals, as responsibility lies primarily with users to become more aware of its advantages.
The new system — which includes a wider scope of use, and an increased daily limit for purchases from SR20,000 to SR60,000, depending on the card holder’s request and preferences — helps increase efficiency and reduce costs for banks, merchants and customers, besides assisting in countering the smuggling of cash.
Customers can also obtain cash back from tellers and shops up to SR400 per day at the time of purchase, to be deducted directly from their personal bank accounts, while there are no limits on the number of times ATM cards can be used, and no usage, annual or balance inquiry fees.
“Tellers and shops will not be subject to fees associated with installation, maintenance and supplies relating to POS terminals, while the service fee will not exceed 0.8 percent of the purchase value, which is no more than SR40,” he said.
According to Al-Furaih, SAMA is working in coordination with banks to further develop and integrate the service. Upcoming developments include the provision of pre-paid cards loaded with amounts, as per the client’s request, the facilitating of electronic payments for purchases online, and the generation of a financial transfer system which aims to separate high value transfers from lower value transfers for greater efficiency.
The idea behind introducing Mada, the new electronic payment system, is to connect ATMs and POS terminals across the country to a central payment switch that in turn re-routes the financial transactions between banks of traders and customers.