Arab Finance: The Financial Regulatory Authority (FRA) has issued two circulars to consumer finance companies, introducing restrictions on the financing of precious metals and new rules governing return rates, according to a statement.

Under the first circular, the companies are banned from financing transactions involving gold bullion and jewelry, as well as bullion and jewelry made from other precious metals, including silver and platinum.  

The decision is based on the classification of gold bullion and jewelry as investment instruments rather than consumer goods. In this regard, they fall outside the scope of goods and services that consumer finance companies are permitted to finance.

Additionally, the FRA required companies to submit quarterly data on interest rates and administrative fees associated with financing obtained from banks, alongside the average return rates and administrative fees charged to customers.

This move aims to enhance transparency and governance in accordance with the procedures applied in the financing of micro, small and medium-sized enterprises (MSMEs). It also supports the authority’s strategy to balance business growth with the protection of market participants.

Meanwhile, Dahab Masr affirmed its commitment to adhering to all applicable regulatory decisions and requirements issued by the FRA regarding the regulations governing dealings with consumer finance companies.