The Turkish recipe of no-interest instalments for purchases paid by credit card has become the "key" to rebooting lending in banks' eyes, so that five top banks introduced this facility last year.
Even taxes and insurance policies can be paid in instalments this year, after the model had been initially provided for purchases of electrical home appliances or apparel.
For instance, Turkey's Garanti Bank last week introduced the option of paying taxes by credit card in three instalments by late March. In a similar move, BCR offers the possibility of paying in six monthly instalments at most the value of auto liability policies sealed with BCR Asigurări. Raiffeisen has a similar partnership with Uniqa insurer, where payments can be divided into 12 monthly interest-free instalments.
At the moment the transaction is done, the total sum is deducted from the card's available sum, but the monthly receipt includes just a fraction, in line with the number of instalments agreed upon.
"Since in Romania cash transactions are still preferred to those by card, banks need to use certain 'incentives' to boost the degree credit cards are used at among owners of such cards. Loyalty programmes have become banks' most lucrative instrument, both in attracting new clients, and in boosting the use of existing cards," says Ilgaz Kaya, marketing manager with Garanti Bank.
The programme is not new on the market, being launched by Turkey's Credit Europe Bank (the former Finansbank) in early 2000. However, the model of interest-free instalments became highly popular last year, when it was taken over by top players such as BCR, BRD, Raiffeisen, Alpha Bank or Bancpost.
The Turkish recipe of no-interest instalments for purchases paid by credit card has become the "key" to rebooting lending in banks' eyes, so that five top banks introduced this facility last y
