Unpaid loan and credit card debts surge in Turkey’s first quarter 2019
The Banks Association of Turkey (TBB) Risk Center announced that the number of retail customers with unpaid consumer loans or credit card debts has surged by 27 percent in the first quarter of 2019 compared to the same period last year.
A total of 193,389 bank customers did not pay their consumer loan or credit card debts by March, a report released by TBB said on Monday. The total over the first three months of 2019 was 482,610 customers, compared to 378,829 last year.
The number of people who faced legal proceedings due to unpaid credit card debts increased by 44 percent over the same time period compared to last year's rate, reaching up to 317,000, the report said.
Credit card debt has grown exponentially since Turkey emerged from a financial crisis in 2001. Banks had for long periods typically increased credit card limits without requesting the permission of their customers, encouraging more spending.
Clients who fail to repay the debts face heavy charges, or banks encourage them to turn the debt into a consumer loan, freeing up the credit card for more spending.
Turkish banking customers typically hold more than one credit card and can own several.