Credit card spending has exploded! New regulation on limit and number of installments

Due to reasons such as high inflation and high cost of living, citizens find the solution to spend with credit cards. However, this situation also brings with it different economic difficulties. According to Interbank Card Center (BKM) data, spending by credit card increased by 103 percent in May, reaching 1.3 trillion TL.

THE NUMBER OF CREDIT CARDS APPROACHED 410 MILLION

According to the news of Dünya newspaper; Credit card usage is increasing rapidly in Turkey. According to BKM data, card payments have more than doubled in the last year, and the total number of cards has reached 410 million.

MAXIMUM LIMIT WILL BE 4 TIMES YOUR MONTHLY INCOME

It is rumored that the Banking Regulation and Supervision Agency (BRSA) will make a regulation regarding credit card limits in the coming days. It is planned to allocate a maximum limit of 4 times the monthly income for those who have been using the credit card for a short time, and a limit of 8 times the sum of their salaries and side incomes for customers who have had the card for a long time and make regular payments. It is also rumored that the number of installments will be reduced in order to reduce high installment expenses.

ADDITIONAL MEASURES DID NOT REDUCE CARD USE

In this context, with the regulation made by the Central Bank in March, the interest rate for credit card cash advance withdrawals was increased from 4.42 percent to 5 percent, and the interest rate for overdraft accounts was increased to 5 percent in order to restrict credit card use and increase monetary tightening. However, it appears that this increase did not reduce credit card usage.

Evaluating the increase in credit cards, experts say that inflation, which exceeded 75 percent in May, is the main reason for the increase in credit card expenditures, and that credit card usage has increased because consumer loan interest rates, which are approaching 80 percent annually, are still much higher than credit card interest rates.