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The Person to Person Loan Agreement is designed for use in Saudi Arabia when one individual wishes to lend money to another in compliance with Sharia law and Saudi civil regulations. This document is essential for formalizing personal lending arrangements while ensuring adherence to Islamic financial principles, particularly the prohibition of interest (Riba). It should be used whenever a personal loan is being made between individuals in Saudi Arabia, regardless of the loan amount. The agreement includes comprehensive details about the loan amount, purpose, repayment terms, default procedures, and dispute resolution mechanisms. It provides legal protection for both parties while ensuring the transaction remains Sharia-compliant and enforceable under Saudi law. The document is particularly important in the context of Saudi Arabia's dual system of civil law and Sharia principles, requiring careful drafting to maintain compliance with both legal frameworks.

1. Parties: Identifies and provides full details of the Lender and Borrower, including their legal names, addresses, and national ID numbers

2. Background: Establishes the context of the loan and confirms its Sharia-compliant nature

3. Definitions: Defines key terms used throughout the agreement

4. Loan Amount and Purpose: Specifies the principal amount being lent and the approved purpose of the loan

5. Repayment Terms: Details the repayment schedule, including payment amounts and due dates

6. Method of Payment: Specifies acceptable payment methods and account details for repayment

7. Representations and Warranties: Statements by both parties confirming their capacity and authority to enter into the agreement

8. Borrower's Obligations: Lists the borrower's commitments and responsibilities under the agreement

9. Default and Consequences: Defines events of default and their consequences, ensuring Sharia compliance

10. Notices: Specifies how formal communications between parties should be made

11. Governing Law and Jurisdiction: Confirms Saudi law applies and specifies jurisdiction for dispute resolution

12. Execution: Signature blocks and execution requirements