2.3 Regulations and Other Actions Regarding the Financial System

2.3.1 Maximum Interest Rates for Credit Cards

Since November 2020, the maximum interest rates for credit cards have been determined by a predictable, rule-based method reflecting current market conditions. Accordingly, the maximum interest rates for credit cards are based on the reference rate calculated according to the Communiqué on Procedures and Principles Regarding the Fees That Banks Can Charge Commercial Clients (No. 2020/4), and the calculation method for these rates is as follows (Table 2.3.1.1).

Table 2.3.1.1. Maximum Interest Rates on Credit Card Transactions (%)

To increase the functionality of the market mechanism and to support the efficient use of financial resources, with a regulation dated 25 July 2023, maximum contractual rates on credit card transactions were differentiated to apply higher rates for cash advances or purchases. Accordingly, the monthly maximum contractual interest rates for credit card cash advances or purchases were determined by adding 131 basis points to the monthly reference rate. The monthly maximum overdue interest rates for credit card transactions in Turkish lira were determined by adding 30 basis points to the monthly maximum contractual interest rates applicable to credit card transactions in Turkish lira.

Accordingly, the maximum contractual and overdue interest rates applicable since December 2022 are shown in Table 2.3.1.2.

Table 2.3.1.2. Maximum Interest Rates on Credit Card Transactions (%)

2.3.2 Regulations on Fees

2.3.2.1 Regulations Regarding Fees Chargeable to Commercial Clients

The “Communiqué No. 2020/4 on Procedures and Principles Regarding the Fees that Banks Can Charge Commercial Clients” arranges the fees that banks can charge their commercial clients for products and services they offer. The purpose of the Communiqué is to enhance predictability and transparency in transactions between banks and their commercial clients, to ensure consistency of concepts and terminology, and to prevent excessive pricing.

Regulations published in the Official Gazettes of 23 June 2023 and 25 November 2023 and 22 December 2023 introduced some changes in the Communiqué No. 2020/4. Accordingly, with the amendment dated 23 June 2023, the announcement time of the reference rate was changed. Prior to the regulation, the reference rate used to be announced on the fifth to the last business day of each month, however, the regulation stipulated that if a Monetary Policy Meeting is to be held in the same month after the fifth to the last business day of the respective month, the reference rate would be calculated and announced based on the most recent data available on the meeting date.

The amendment of 25 November 2023 terminated the application of a 50% increment in the maximum tariffs for late EFT and FAST transactions, EFT transactions outside official working hours and FAST transfers at weekends, additionally stipulated that the cost incurred for printed statements would be reflected exactly to commercial clients.

The amendment dated 22 December 2023 introduced a cap on the reference rate. Accordingly, the calculation method of the reference rate (the lower of the weighted average flow interest rate that banks applied to Turkish lira deposits with a maturity of 32-45 days and the policy rate plus 10%) was kept unchanged, yet the upper limit was set at 3.11. The same amendment also regulated that monetary limits and maximum fees for EFT, FAST and remittance transactions, which were set as fixed prices by the Communiqué No. 2020/4, would be calculated and notified to banks by the CBRT each year.

Finally, the CBRT responded to approximately 550 applications regarding the fees chargeable to commercial clients under the Communiqué No. 2020/4.

2.3.2.2 Fees Chargeable to Financial Consumers

The Communiqué on Procedures and Principles Regarding the Fees to be Charged to Financial Consumers (No.2020/7) published in the Official Gazette No. 31061 of 7 March 2020 regulates the fees chargeable to financial consumers for products and services offered. The purpose of the Communiqué No. 2020/7 is to determine the procedures and principles governing any kind of fees, commissions and expenses other than interest rates and profit share chargeable to financial consumers for the products and services offered by institutions.

In 2023, the issues requiring regulatory action as part of regulations on fees were determined and the following amendments were made to Communiqué No. 2020/7.

The amendment published in the Official Gazette dated 25 November 2023 terminated the application of a 50% increment in the maximum tariffs for late EFT and FAST transactions with FAST transactions performed outside the official working hours of the EFT system and conducted at weekends.

The amendment published in the Official Gazzette dated 22 December 2023 also regulated that monetary limits and maximum fees for EFT, FAST and remittance transactions would be calculated and notified to banks by the CBRT each year.

Finally, the CBRT responded to approximately 9,500 applications regarding the fees chargeable to financial consumers under the Communiqué No. 2020/7.