Can you protect your receivable with a promissory note?
Hello, this is a short video designed from a series of educational videos to give you the knowledge that you require to enhance your collection practices. We will talk in this video about promissory notes under Saudi law and their role as an executing document that you can enforce through the Saudi execution courts.
Promissory notes can be very effective tool to collect your debts as they have substantial leverage against the debtor and In the event that the debtor is unable to pay the money mentioned in the bond for an order, this may cause:
- executing on their bank accounts.
- banning them from traveling.
- restrict government agencies from dealing with you.
However , for a promissory note to be effective, it must follow a strict formalities as prescribed in the law and they must include the following:
It must state the phrase “promissory note” on it.
You must place the place of creation of this promissory note, meaning where it was written (e.g., Riyadh, Jeddah)
Must contain the following statement: “I pledge to pay under this bond to the order so-and-so”.
Then the full name is mentioned, and it is preferable to put the nationality, and his ID number.
The amount of debt must be stated. For example, 10,000 Saudi riyals, and write the due date, such as 1/1/1440 AH,.
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