Turkey's firms face cash crunch as commercial loan rates top 50%

Commercial loan interest rates in Turkey have risen to around 53%, with consumer, vehicle and mortgage rates also climbing sharply. Companies report severe cash‑flow problems as banks tighten credit, forcing firms to prioritize liquidity over profitability. Experts warn that delayed payments, high inventory costs and expensive financing are squeezing cash reserves despite ongoing production.

Following the failed 15 July 2016 coup attempt, the Central Bank and authorities injected unlimited liquidity into the banking system, relaxed collateral requirements and lifted foreign‑currency deposit limits. Citizens exchanged roughly $11 billion into Turkish lira, helping to stave off a market shock. Regulatory measures curbed short‑selling and facilitated share‑buybacks, allowing the BIST 100 index to recover within ten trading days and resume growth, contributing to a post‑crisis economic expansion.

The combined pressure of soaring loan costs and the legacy of emergency financial safeguards highlights the ongoing challenge for Turkish businesses to maintain operations amid tight credit conditions.