Savings are cheap, credit is expensive

Banks, which maintain loan interest rates above 45-50%, offer interest rates as low as 14% for Turkish Lira term deposits. While the difference in the loan-deposit spread expands bank profits, the real sector's capital is eroding.

Economists and the business community are calling for lower loan interest rates and the removal of credit limits to ensure Türkiye achieves balanced and prosperous growth. While loan interest rates at some banks and factoring companies are approaching nearly 2.5 times the inflation target, deposit rates are even below inflation. The yield on a one-year, 1 million lira term deposit in Turkish Lira starts at 14 percent and can reach as high as 33.5 percent at both private and public banks.

REPAID 1.4 MILLION TL

Thus, the net return on a 1 million lira deposit at the end of one year can reach a minimum of 126,000 lira and a maximum of 284,000 lira. Citizens or companies who go to banks with 1 million lira in savings are offered a maximum interest rate of 33.5 percent. At Denizbank, which offers this interest rate, the net return on a 1 million lira deposit with a one-year maturity is 284,000 lira. Yapı Kredi offers 31.2 percent, Akbank 31 percent, and Ziraat Bank 30 percent for savings of the same amount and maturity. One-year deposit interest rates are 26.5 percent at Garanti and İş Bank, 23 percent at Halkbank, and 22 percent at Vakıfbank. The lowest rates are seen at Odeabank with 16 percent and TEB with 14 percent.

While the return on a 1 million lira deposit in public and private banks can be as low as 1.1 million lira, companies are forced to pay close to 1.4 million lira for commercial loans of the same amount and maturity.