Turkish regulator the Banking Regulation and Supervision Agency (BDDK) has threatened to implement draft regulations imposing a “single limit” on all credit cards.
BDDK is planning to ban banks from giving any customer a credit limit that is over four times their monthly income. It is thought that the government is concerned by the rapid growth of consumer loan volume, which reached TRY237bn ($119bn) in September, up 84% since 2010.
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An economy official said: “The prepared draft is expected to be put on the table during the planned weekly meeting of the banking watchdog this week.”
Overall loan volume reached TRY1tr this September, an increase of around 46.5% since 2010. Consumer credit card debt now totals TRY82.3bn, up 88% from 2010 figures.
Under the new, stricter regulations coming into force, overdrafts on deposit accounts and credit card loans will come under the umbrella term of consumer loans, and banks will no longer be able to charge higher interest rates on those services.
The move to crack down on lending and decrease household debt comes a couple of months after Prime Minister Recep Erdo?an lashed out at banks for exploiting the “poor”.
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By GlobalDataHe said: “Those credit cards: Don’t have them. If everybody spends as much as the banks want, they would not even be able to earn that income. They could never be satiated.”
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