Foreigners who intend to immigrate or invest in Turkey can open a bank account so that they can enjoy its various advantages.
In this article, we will provide comprehensive information about banking interests in Turkey and how to get them, interest tax on deposits, bank interest earnings, as well as a comparison of banking benefits for different Turkish banks, so stay tuned!
How do you get banking interests in Turkey?
In order to get a bank interest in Turkey, you must first open a bank account in one of the banks in this country.
You can open an account in Turkey in less than half an hour, and attendance in person when opening a bank account is mandatory in Turkey.
After the end of the agreed contract term with the bank in Turkey, it is possible to obtain bank interests in cash and non-cash.
In other words, you can request to transfer the interest to your bank account card, or receive it in cash by visiting the bank.
If you add your interest to your bank card, you can easily use it to make purchases from the internet, however some people who live in Turkey may prefer to get their earnings in cash.
Information about banking interests in Turkey
Banking interest is one of the safe ways for people who want to deposit their money in banks to invest in Turkey.
First, you should know that all public and private banks in Turkey are subject to the financial laws of the Central Bank of Turkey.
This means that in the event of any change in the rules, updates will be applied to all banks in Turkey.
In other words if the bank interest rate changes, this change will include all Banks in Turkey.
Another point worth noting is that short-term deposits are the fastest and most profitable in Turkey, so if you want to get your bank interest on a monthly basis, you can open a one-month deposit.
Bank interest rates in Turkey in 2020 decreased significantly compared to banking interest rates in 2019.
In recent years, Turkey was one of the countries that attracted a large amount of investors through bank deposits, and before some changes took place in 2020, the bank interest in Turkey was above 20%.
But in 2020, the Turkish government cut the bank interest rate sharply after 10 months of controversy, and the interest rate currently ranges between 10 to 15 percent.
The interest rate in Turkey varies according to the customer’s deposit amount, and in cases where the investment amount is high, the head of the bank branch can raise the interest rate.
The interest rate in Turkey on 3-month deposits is about 10%, and the longer the deposit period, the higher the amount, as the bank interest rate can reach 15%.
Types of bank interest in Turkey
Variable bank interest
The variable bank interest may vary based on the rate announced by the Central Bank of Turkey every month, for example in one month it may be 10% and in another month it may reach 13%.
Fixed bank interest
When obtaining fixed bank interest, a specific interest rate regulation will be set in your contract with the bank, which will be added to your deposit at the end of the contract period, the term of deposit and interest contracts for banks can be 3 months, 6 months or a year.
Note that there is no concept of daily earnings in Turkish banks, as banks do not pay interest on undeposited amounts.
How are bank interests calculated in Turkey?
If you intend to invest and profit from banks in Turkey, you should know how the bank interest is calculated in this country.
For example, suppose there is interest on a bank deposit of 8%, your minimum balance is taken into account, then the number obtained is multiplied by 8%, and the total is divided by 365 days.
Note that this number will be only in the event that you have not withdrawn funds from your account until the end of the contract.
If you withdraw funds from your account before the end of the term of the deposit agreement, the relevant bank has the right to reduce the bank interest from your account balance.
Comparison of bank interest earnings in different Turkish banks
You can use the following website to find out the banking interest rates in different Turkish banks and compare them with each other.
All you have to do is enter the site, enter the amount you want to deposit and specify the deposit period, after that a table will be displayed containing several options for Turkish banks and the banking benefits for each of them.
Bank interest tax fees in Turkey
Tax laws in Turkey are very strict, and one of the prerequisites for opening a bank account in Turkey is to pay tax fees.
It is necessary to obtain a tax number when opening a bank account in Turkey in order to pay the bank interest tax fee to the tax office in Turkey.
The bank interest tax fee rate in Turkey in 2020 is about 3% to 10% of the gross profit.
Obtaining banking benefits for foreigners who do not have a residence permit in Turkey
If you are a foreign citizen of any country and you have not obtained permanent residence in Turkey, you will only be able to open an account at Ziraat Bank.
Ziraat Bank is one of the oldest and most prestigious banks in Turkey, the bank was founded in 1863 and is ranked 115th in the world.
In this bank, in addition to having a bank account in lira, you can also have a bank account in Dollar and Euro and get banking interest.
However, it is better to know that bank interest rates in Turkey are lower for euro and dollar accounts than for Turkish lira accounts.
Banking interest at Ziraat Bank in Turkey is determined based on the deposit method and the amount that the customer deposits in the bank.
For example, if you have a 3-month deposit in Ziraat Bank in Turkey, you will receive interest from 9 to 10 percent, and it should be noted that the longer your money stays in Ziraat Bank and you do not withdraw it, the more profit you will get.
Bank interest rates in Ziraat Bank in Turkey have decreased significantly with the changes that occurred in 2020.
The bank interest rate in Ziraat Bank in 2019 was about 20 to 24 percent annually, while in 2020 it decreased from 10 to 15 percent annually.
And about 3 to 10 percent of the gross profit rate is deducted as a tax fee annually.