Jun 30 2018

Central bank increased maximum interest rates for credit cards

The Turkish Central Bank (CBRT) has increased the monthly maximum contractual interest rate for the credit card borrowings to 2.02 percent for the Turkish lira and 1.62 percent for foreign exchange transactions on Saturday.

The new rates will be effective from 1 July 2018. The CBRT also set the monthly maximum overdue interest rate as 2.52 percent for the Turkish lira and 2.12 percent for foreign exchange transactions.

The monthly maximum contractual interest rate for the credit card borrowings was previously set as 1.84 percent for the Turkish lira and 1.47 percent for foreign exchange transactions, while the monthly maximum overdue interest rate was 2.34 percent for the Turkish lira and 1.97 for foreign exchange transactions.

In its press release, the CBRT reminded that the banks charged higher interest rates for credit card borrowing than they did for consumer loans. “The CBRT, therefore, advises credit card holders with short-term credit needs to seek a consumer loan rather than borrowing on personal credit cards,” the bank said.