As credit card spending hits a record high, warnings over fees and interest rates increase
While the number of credit cards in Turkey approaches 152 million, breaking records, experts warn against the additional costs created by minimum payments, cash advances, and maturity differences.
As credit card use in Turkey reaches record levels, approaching 152 million, experts point out that hidden costs on account statements such as minimum payments, cash advance interest rates, installment maturity differences, and foreign exchange rate differences are straining budgets.
Number of Credit Cards and Spending
Credit card use in Turkey has increased rapidly, approaching 152 million, and card spending has reached record levels. The number of bank customers is over 41 million.
Minimum Payment Does Not Clear Debt
Experts state that paying only the minimum amount on the account statement does not clear the debt. High interest rates ranging from 3.25% to 4.25% continue to be applied to the remaining debt depending on the end of the period.
High Cash Advance Cost
The monthly 4.25% interest applied when drawing a cash advance from a credit card approaches 5% when combined with taxes and funds. This rate creates a cost even higher than consumer loan interest rates.
Installment and Maturity Difference Balance
Postponing single-payment purchases into installments is not always free of charge. While interest-free options make sense in an inflationary environment, long maturities can increase the total cost.
Exchange Rate Difference in Foreign Spending
Transaction fees, exchange rate differences, and options to convert into Turkish Liras during payment for credit card spending made abroad can bring additional costs and surprise expenses for consumers.
Deposit and Loan Interest Rates
According to Central Bank data, 1-3 month maturity TL deposit interest rates fell to 37.3%, while personal loan interest rates rose to 49.8% and commercial loan interest rates rose to 40.8%.