Severe symptom of a savings gap? Turkey leads Europe in credit card debt

Credit card debt accounts for 53 percent of all consumer debt in Turkey, the highest among European countries; the ratio of credit card debt is 25 percent in the UK, 21 percent in Poland, and just 5 percent in The Netherlands.

According to a report in the Bugün daily, Turkey currently leads European countries in terms of the ratio of credit card debt to total consumer debt. The report also highlights that one of Turkey's biggest problems is a savings gap, which increases reliance on overseas borrowing or aid.

Parallel to the savings problem, Turkey has the highest figures in Europe in terms of the ratio of credit card debt to the gross domestic product (GDP), with 53 percent. Consumers in Turkey bear 37 percent of their debt in the way of personal loans, 11 percent as additional accounts and 20 percent as loans from family members or friends.

Turkey's current savings stands at 13-14 percent of GDP, while this figure is 38 percent in Europe. According to the Dutch banking multinational firm ING report titled “International Survey on Savings,” the rate of those in the EU who do not have savings has increased from 35 to 38 percent over the last year, while in Turkey this figure increased from 40 to 44 percent in 2014.

The report noted that 62 percent of Turkish consumers are not able to routinely increase their savings. Also, the number of those in Turkey who say that the economic circumstances at large have adversely affected their financial status has increased from 31 percent to 39 percent, while the same ratio decreased in Europe from 41 to 26 percent over the course of 2014.