The BRSA has restricted the number of installments on credit card transactions depending on the sector.
The aim here is to keep people's spending from exceeding their income and to maintain an income-expense balance.
If we go through the BRSA's installment regulation for credit cards under the main headings:
- For furniture and white goods purchases, credit card installments were cut from 12 months to 9 months.
- For TV purchases priced at 5 thousand TL and above, installments were set at 4 months.
- For vehicle purchases priced at 120 thousand TL and below, the loan term was cut from 60 months to 48 months.
- For gold purchases, the number of credit card installments was cut from 6 months to 3 months.
- Under the BRSA regulation, jewelry spending, excluding minted and bullion gold, can be paid in installments for at most 3 months. Previously, the installment term for such spending had been set at 6 months. While the installment term for TV purchases stayed fixed at 4 months, the threshold in the restriction was also raised from 3 thousand 500 TL to 5 thousand TL. Installments of 4 months can be made on TVs with a consumer sale price of 5 thousand TL and above. For white goods and furniture purchases, credit card installments were cut from 12 months to 9 months.
- Vehicle loans extended through bank loans and financial leasing were also reorganized. The installment terms were set as follows:
- For loans extended for vehicle purchases with a final invoice value of 120 thousand TL and below, the term was cut from 60 months to 48 months.
- For loans extended for vehicle purchases with a final invoice value between 120 thousand TL and 300 thousand TL, the term was cut from 48 months to 36 months. The upper limit on the ratio of the loan amount to the vehicle value was lowered to 50 percent.
- For vehicle purchases with a final invoice value above 300 thousand TL and not exceeding 750 thousand TL, the loan term was cut from 36 months to 24 months,
- For those with a final invoice value above 750 thousand TL and not exceeding 1 million 500 thousand TL, it was cut from 24 months to 12 months.
- The Banking Regulation and Supervision Agency (BRSA) also raised the risk weights for individual credit cards and personal loans, from 75 percent to 100 percent. Accordingly, the risk weight of 75 percent on installments or cash advances of 1-6 months was raised to 100 percent, and for those over 6 months it was raised to 150 percent. For personal loans, the risk weight was raised from 75 percent to 100 percent for loans with a term of 1-12 months, and from 75 percent to 150 percent for terms of 1 year and above.
