“The State of Fintech Ecosystem in Türkiye 2021" prepared under the coordination of Finance Office of Presidency of the Republic of Türkiye has been published.
“The State of Fintech Ecosystem in Türkiye 2021" prepared under the coordination of Finance Office of Presidency of the Republic of Türkiye has been published.
The State of Fintech Ecosystem in Türkiye 2021, which will provide an up-to-date and accurate presentation of developments and data on the Turkish financial technologies sector, has been prepared to provide references to local and foreign investors, entrepreneurs, and academic literature. The report, published for the first time, is planned to be shared with the ecosystem regularly every year.
Regulations supporting innovation continue to increase.
In the State of Fintech Ecosystem in Türkiye, prepared with the coordination of the Finance Office and in partnership with Startups.watch,the regulations that have been implemented in the field of financial technologies in recent years and leading for the development of the fintech sector are explained in detail.
Especially due to the pandemic, changing needs in the financial sector have increased digitalization in product and service applications. The updated regulations in this direction continue to guide the sector for ease of operation and efficiency. With digital onboarding, the obligation to physically carry out the identification and contract processes of individual customers has been eliminated. With the TR QR code regulations, QR code technology has been actively used. Some innovations and news such as the establishment of the Payment and Electronic Money Institutions Association of Turkey, equity and debt-based crowdfunding, and the IBAN application for e-money institutions have brought new perspectives to the sector and offered the opportunity for new business models. Payment initiation and account information service provider business models have entered our lives thanks to the clarified definitions of open banking through the updated secondary regulation.
Through the digital-only banking and banking as a service (BaaS) regulation and the tests on central bank digital currency (CBDC), it is expected that those will bring a new dimension to the financial technologies sector and diversify the business models in the fintech ecosystem.
Türkiye fintech ecosystem is developing
Türkiye strong banking sector and technological infrastructure provide a basis for the increase in the digitalization rate of individual and corporate customers in the financial sector so it accelerated the development of the fintech ecosystem. In Türkiye, where there are 70.3 million active retail digital banking users, it has been reached 1.7 million POS terminals, 52 thousand ATMs, 82.8 million credit cards, and 54.4 million prepaid cards. The contactless payment rate, increased with the pandemic, reached the level of 48%. All these indicators are expected to continue to increase in the upcoming period.
In the ecosystem in which 520 fintech companies actively operate, more than $64 million investment was made in 2021. However, fintech exits are $48 million in 2021. In 2022, it is expected that the investments will increase with the regulations to be made and the decrease of the effect of the pandemic. All these changes are expected to support the growth of the fintech sector.
Efforts to strengthen the sector continue.
One of the main focuses of the İstanbul Financial Center, one of the most important projects carried out by the Finance Office, is financial technologies. İstanbul Finance and Technology Base is planned to be established within IFC with a focus on fintech and technopark status. In addition, IFC will include a regulatory sandbox where fintechs can develop their products and services in a controlled environment under the regulator’s supervision. Moreover, studies for the National Fintech Strategy Document, which will reveal an action plan for the fintech ecosystem between 2022 and 2025, are continuing. The document, which is planned to be published in the first quarter of 2022, will be a roadmap for the development of the sector.
