According to the news in Yeniçağ; Inflation, which exceeded 75 percent in May and reached record levels, alarmed the economy management. The Central Bank of the Republic of Turkey (CBRT) implemented a series of macroprudential measures in order to support the monetary tightening policies it has been implementing. In this context, two important regulations directly affecting credit card holders have been put into effect.
NEW ERA IN CREDIT CARDS: INSTRUCTIONS GIVEN TO BANKS
In the first months of the year, when many customers turned to credit card cash advances in order to benefit from the ‘low interest’ opportunity, banks had reduced the term limit for installment cash advances from 12 months to 6 months. However, when the expected cooling did not occur, banks reduced this period to 3 months upon the instructions of the Banking Regulation and Supervision Agency (BDDK). Following this decision, the details of another restriction concerning credit card users became clear.
In order to prevent the intensive use of installment cash advances despite interest rates at 5 percent, the economy administration decided that installments exceeding 3 months will not be made for money withdrawn from credit cards.
Banks were granting many customers cash advance limits equivalent to their credit card limits. However, the BDDK stated that this situation encouraged cash transactions and instructed banks to apply a 25 percent limit on cash advance transactions on credit cards. Thus, customers will be able to use cash advances of only 25 percent of their current credit card limits. For example, a credit card holder with a 10,000 lira limit will be able to withdraw a maximum of 2,500 lira in cash advances in a day.
INSTALLMENT BAN ON THE AGENDA
Meanwhile, Treasury and Finance Minister Mehmet Şimşek’s criticism of the installment regulations applied to credit card transactions led to comments that new bans on installment purchases made with credit cards could be introduced in the banking sector.
