Article 387 of the Saudi Civil Transactions Law
المادة 387 من نظام المعاملات المدنية · الفصل الرابع: عقد القرض
The article sets the time for repaying a loan: if a term or purpose was fixed, repayment is not due before it ends; otherwise it is due when the lender asks, unless the borrower would be harmed.
Official text (Arabic)
This article has not been amended since the law was issued.
1- إذا عُيِّن للقرض أجلٌ أو غرضٌ لم يلزم المقترض الوفاء قبل انقضاء الأجل أو المدة المعتادة للانتفاع به في مثل ذلك الغرض.
2- إذا لم يعين للقرض أجلٌ أو غرضٌ لزم المقترض الوفاء عند طلب المقرض؛ ما لم يكن المقترض يتضرر بالوفاء فلا يلزمه إلا إذا مضت المدة المعتادة للانتفاع بمثل المال المقترض.
This is the official Arabic wording, the only legally binding version. We do not translate the law itself; the explanation below is ours. Official source: Bureau of Experts at the Council of Ministers
Article 387 explained in plain English
This article answers a common question: when must the borrower repay the loan? It distinguishes between two cases:
Case one: a term or purpose was fixed for the loan. The borrower need not repay before:
- the expiry of the term set, or
- the customary period of use of the loan for the like of the purpose for which it was borrowed.
The lender cannot demand repayment before then.
Case two: no term and no purpose was fixed for the loan.
- The rule: the borrower must repay when the lender asks.
- The exception: if the borrower would be harmed by repaying, he need not repay until the customary period of use of the like of the borrowed money has passed.
The article does not state in numbers what the "customary period" is; it varies according to the type of money and the purpose, and recourse is had to what is customary in such cases.
This article is connected to Article 388, which obliges the borrower to return the equivalent of the borrowed thing in amount, type and description when the loan period ends, or, if returning the equivalent is impossible, its value on the day of borrowing. It is also connected to Article 386, on defects and third-party claims in borrowed money.
It is advisable for the parties to set the repayment term in writing to avoid disputes. In case of a dispute over the time of repayment, it is advisable to consult a lawyer who specializes in civil cases.
Practical example
Bandar borrowed thirty thousand riyals from his brother to buy equipment for a small shop he was opening in Tabuk, without fixing a repayment date. A month later his brother demanded the amount. Since a purpose was fixed for the loan, Bandar need not repay before the customary period of use of a loan for such a purpose has passed.
Translated from our Arabic explanation with machine assistance. For guidance only; it does not replace advice from a lawyer on your situation.
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Frequently asked questions about Article 387 of the Saudi Civil Transactions Law
Can the lender demand the loan before its due date?
If a term or purpose was fixed for the loan, the borrower need not repay before the term expires or the customary period of use for that purpose has passed.
When is a loan repaid if no date was set?
If no term and no purpose was fixed, repayment is due when the lender asks, unless the borrower would be harmed by repaying.
What if the borrower would be harmed by immediate repayment?
He need not repay until the customary period of use of the like of the borrowed money has passed.
More articles on Loan Contract
- Article 382
The article defines a loan as a contract by which the lender transfers ownership of a fungible thing to the borrower, on condition that the borrower returns its equivalent.
القرض عقد يُمَلِّكُ بمقتضاه المقرِضُ شيئًا مثليًّا للمقترض على أن يرد مثله.
- Article 383
The article provides that a loan contract is formed only when the borrower takes possession of the borrowed thing.
لا ينعقد القرض إلا بقبض الشيء المقترض.
- Article 384
The article requires the lender to have full legal capacity, and prevents a guardian or custodian from lending the money of a person under his authority, or borrowing for him, except in accordance with the legal provisions.
1- يجب في القرض أن يكون المقرض كامل الأهلية. 2- ليس للولي أو الوصي إقراض مال من هو في ولايته ولا اقتراضه إلا وفقًا للنصوص النظامية.
- Article 385
The article makes void any condition, made at the time of the contract or when payment is deferred, that includes an increase in the repayment of the loan paid by the borrower to the lender.
يقع باطلًا كل شرط عند العقد أو عند تأجيل الوفاء يتضمن زيادة في رد القرض يؤديها المقترض إلى المقرض.
- Article 386
The lender does not guarantee against a third-party claim to the borrowed money or its defects unless he concealed them or guaranteed it is free of them; the borrower's duty to return an equivalent lapses on a claim, and a defective item is returned at its value as defective.
1- لا يضمن المقرِض استحقاق المال المقترَض ولا خلوه من العيوب، ولكنه مسؤولٌ عما يلحق المقترض من ضرر بسبب الاستحقاق أو العيب إذا تعمد إخفاء أيٍّ منهما أو ضمن خلو
- Article 388
The article obliges the borrower to return the equivalent of the borrowed thing in amount, type and description when the loan period ends; if returning the equivalent is impossible, he must return its value on the day of borrowing.
يلتزم المقترِض برد مثل الشيء المقترَض مقدارًا ونوعًا وصفةً عند انقضاء مدة القرض، فإذا تعذر رد مثله وجب رد قيمته يوم الاقتراض.
The texts are reproduced from the official website of the Bureau of Experts at the Council of Ministers for reference; where they differ, the officially published Arabic text prevails. This content is not legal advice.