Banking watchdog allows installment payments for gold, jewelry again

ANKARA

Turkey’s banking watchdog (BDDK) has returned to allowing payment of jewelry and gold via credit card in up to four installments, after a ban on installments that lasted around one year, according to a regulation published in the Official Gazette on Oct. 22. The decision pleased many sector representatives, who have been complaining about decreasing sales for the last year.

“Gold and jewelry products may be paid for by credit card in installments for up to four months,” stated the new regulation, adding that purchases with corporate credit cards would be excluded.

Sector representatives said they are very happy with the latest BDDK decision, as they previously made around 75 percent of their sales by credit card but faced a dramatic decrease in sales after the ban on the credit card installments.

“We have seen a drop in our sales of around 30 percent after the ban for the past year,” said the head of the Jewelry Industry Council of the Union of Chambers and Commodity Exchanges of Turkey (TOBB), İmam Altınbaş.

“We are very happy with the latest decision of the BDDK and we know our production levels and sales will increase again throughout the year, especially on special days such as Valentine Day,” Altınbaş added.

Some 250,000 people are employed in the sector in Turkey, where there are 5,000 producers. There are around 35,000 retail points in the Turkish jewelry sector, according to TOBB figures.

The BDDK introduced new rules at the end of 2013 to clamp down on the use of widely used credit card installment plans, in a bid to stem spending on imports and rein in Turkey’s ballooning current account deficit.