100 billion liras loan package for tradesmen takes effect
The government’s Treasury-supported loan package scheme for tradesmen and craftsmen has taken effect following a presidential decree, Treasury and Finance Minister Nureddin Nebati has announced.
State lender Halkbank will provide a total of 100 billion Turkish Liras ($5.4 billion) to the businesses at an annual interest rate of 7.5 percent to be paid back in 60 months, Nebati wrote on Twitter on Oct. 23.
Support for young entrepreneurs
Under the scheme, the limit of loans with no interest to be made available to young entrepreneurs has been increased from 100,000 liras to 300,000 liras, while the age limit to be eligible for those financing has been increased from 30 to 35, the minister added.
“Hopefully, interest rates will fall to single digits, and we will save our investors and citizens from the oppression of interest rates,” Erdoğan said in a speech he delivered at a ceremony marking the inauguration of several facilities in the province of Malatya on Oct. 22.
Private banks have also started to lower their interest rates, the president added.
“We did this in the past, lowered [the rate] down to 4.6 percent and inflation then dropped to 5.6 percent. We will increase the income level of all people.”
Erdoğan has been long advocating for lower interest rates to ignite the engine of economic growth.
Earlier this month, he said that interest rates should come down to single digits by the end of the year.
Last week, the Central Bank lowered its benchmark interest rate for the third month in a row.
Central Bank lowered its policy rate
It slashed the one-week repo auction rate from 12 percent to 10.5 percent but signaled that it may end the rate cut cycle.
“The committee evaluated taking a similar step in the following meeting and ending the rate cut cycle,” the bank said in a statement released after the Monetary Policy Committee (MPC) meeting held on Oct. 20.
There will be two more MPC meetings in 2022, scheduled for Nov. 24 and Dec. 22.