The installment limit for credit cards has been introduced

credit card

The Banking Regulation and Supervision Agency increased the credit risk weights to 150% in banks’ capital adequacy while imposing limitations on installment payments. Installment options were removed for expenses related to airlines, travel agencies, and accommodation abroad.

The Authority has decided to increase the risk weights considered in the calculation of capital adequacy standard ratios for consumer loans, individual credit cards, car loans for passenger vehicles to be used by consumers, vehicle-backed loans, and financial leasing transactions with consumers.

Furthermore, it was decided that installment terms applied to credit cards will not be applicable for expenses related to airlines, travel agencies, and accommodations abroad, and no installment will be allowed for such expenses.

The Institution announced that risk weights for consumer loans (including overdraft accounts), individual credit card transactions (including credit card spending and cash withdrawals), car loans for passenger vehicles to be used by consumers, vehicle-backed loans, and financial leasing transactions with consumers will be set at 150 percent under the standard approach.

Leave a Reply

Your email address will not be published. Required fields are marked *