Turkey banks deposit rates hit three-year low
Turkey’s banking system is seeing a sharp squeeze in the spread between what savers earn and what borrowers pay, with short-term Turkish lira deposit rates falling to a three-year low even as consumer and commercial loan costs climb.
That divergence matters because it shows banks are paying less to attract deposits while charging more for credit, a combination that can support margins in the near term but also deepen pressure on households and businesses already facing expensive financing. It also signals that monetary conditions remain tight even after the central bank held its policy rate at 37% this week.
According to weekly data from the Central Bank of the Republic of Turkey, the average interest rate on 1-3 month TL deposits dropped to 37.3% in the week ended Sept. 4, the weakest level since 2023. The rate had reached as high as 47.7% in 2025 before easing gradually to around 37.6% in recent weeks.
At the same time, borrowing costs moved higher. Average consumer loan rates rose to 49.8% from 48.3%, while commercial loan rates increased to 40.8% from 39.3%.
The central bank kept its one-week repo rate unchanged at 37% at its Sept. 10 meeting, while leaving the overnight lending and borrowing rates at 40% and 35.5%, respectively. For investors, that keeps the focus on bank net interest margins, deposit competition and credit demand as households and companies absorb some of the highest real financing costs in the region.
The next catalyst is whether deposit pricing continues to ease faster than loan rates, and whether the central bank’s hold translates into slower credit growth or renewed pressure on borrowers and bank asset quality.
| Entity | Gains | Losses |
|---|---|---|
| Banks | ▲Wider lending margins | ▼Deposit competition |
| Savers | ▲— | ▼Lower TL returns |
| Borrowers | ▲— | ▼Higher financing costs |
| Central bank | ▲Policy flexibility | ▼Credit-stability pressure |