Credit card debts threaten

Turkey’s economy


Bank employees were passing out credit card applications and helping people fill them out. Mr. Yuksel made the equivalent of a few hundred dollars a month working for a lighting fixture shop. But it turned out that did not matter.

“They were asking people to sign, and I did,” he said. Within a week he had a card and a spending limit many times his paycheck.

That was in 2001. Today, Mr. Yuksel, a 32-year-old father of two, owes more than $8,000, much more than his annual income and an amount that will take him more than a decade to repay. He is among millions of Turks who are in over their heads in debt they incurred after local banks aggressively marketed credit cards to low-income people.

Mr. Yuksel’s tale of living on borrowed money illustrates one of the ills plaguing the country’s economy and threatening a new financial debacle in an unstable region. It echoes the subprime mortgage calamity in the United States in 2008, in that the Turkish banks often seemed oblivious to the risk that their new customers might not pay them back.

To read the complete article in The New York Times – click here!