More than 600,000 people in Turkey facing legal action over debt - report

Turkey has witnessed an 18 percent increase in the number of people facing lawsuits due to bank loan debt in the first nine months of the year as compared to the same time period last year, Sözcü newspaper reported, citing a Sept. 2018 report by the Banks Association of Turkey (TBB) Risk Center.

The report by the union, which covers Jan.-Sept. of 2018, found that total of 660,000 people in Turkey are facing legal action for outstanding debt they incurred through loans.

The report arrives as increasing interest rates have hit unprecedented levels due to the excessive depreciation of the Turkish lira, which has lost 40 percent of its value since the beginning of the year, pushing up the borrowing costs leading to an increasing number of individuals and companies experiencing problems in their short term payments.

The number of people facing legal action due to credit card debt for the same period increased by 4 percent as compared to last year, hitting the 1.1 million mark, the newspaper said.

Turkey’s banking regulator in August placed new limits on credit card instalments, banning the use of instalments on certain products and limiting the timeframe over which debt restructuring that can take place for credit card debt.
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