Rising cost of living drives citizens to borrow as debts reaches 31 billion TL

Lefkoşa, North Cyprus – As the cost of living continues to rise in northern Cyprus, many citizens are increasingly turning to bank loans in a bid to cope with growing financial pressures. 

According to recent data, total credit debt owned by Turkish Cypriot has surged to 31 billion Turkish Lira, with a significant portion of borrowers now struggling to meet repayment obligations.

The steady erosion of purchasing power, driven by inflation and mounting daily expenses, has made it difficult for households to cover even basic needs. This has resulted in a growing dependence on financial institutions for survival, with loans becoming a lifeline for many.

According to a report published by Halkın Sesi newspaper, the total amount of consumer credit issued by banks has increased considerably compared to the previous year. Of this total, approximately 88% comprises housing, auto, personal, and consumer loans, while the remaining 11% consists of credit card debt.

Financial experts warn that a growing number of individuals are relying on borrowing not just to maintain their current standard of living, but also to manage pre-existing debts. Many are caught in a cycle of debt, with repayments becoming increasingly difficult amid stagnant wages and rising prices.

Economic indicators suggest that this trend of individual borrowing is likely to continue unless comprehensive measures are taken to address the underlying causes of the financial strain faced by the public.