Name
Global FinTech Guide
Country _ Name
Turkey
SectionTitle
Online banking services
Body
FinTechs belonging to this area offer traditional banking services in a modern way, usually through online services or mobile applications as well as ancillary services – e.g. enabling customers to manage their giro- or custody-accounts online and in real time or offering e-wallet services. Keywords in this context are also API-Banking or Banking as a Service (BaaS)/ Bank as a Platform (BaaP).

API-Banking:

API stands for application programming interface and is offered to access data banks and to extract and insert information. API-Banking consequently means the access to data banks of banks to offer new and innovative banking applications.

Through these services FinTechs offer services with new functions, e.g. enabling customers to manage their accounts online and in real time.

BaaS – Bank as a Service/BaaP – Bank as a Platform:

The API-based Bank as a Service platform has a full banking licence, but merely serves as the back end for standalone independent FinTechs, which “use” the licence and the back end of the bank to offer new financial services, launch additional financial products or expand into additional markets.

Introduction

Attitude of the country towards online-banking services

In Turkey, as a result of the amendments made in article 76 of the Banking Law no. 5411 (“Banking Law”) by the Law on Making Amendments to Certain Laws and Decrees dated 18 June 2020 and numbered 7247, and with entry into force the Regulation on the Establishment of a Contractual Relationship in the Electronic Environment and the Remote Identity Detection Methods to be Used by Banks prepared pursuant to these amendments; establishing contractual relations between banks and their customers in electronic environment, including contracts subject to written form requirement became possible. With these developments, BRSA has aimed to construct the foundations of the digital banking model, which operates only in the digital environment without a physical branch, as in the European Union and UK applications.

As a result of the increasing number of FinTech companies and their desire to work in this field, on 29 December 2021, with the aim of promoting financial innovations in the banking sector, increasing financial inclusion, and facilitating access to banking services the BRSA has published the Regulation on the Operating Principles of Digital Banks and Service Model Banking (“DB Regulation”).

The Regulation aims to determine the operating principles of branchless banks that serve exclusively through digital channels and the conditions for the provision of banking as a service model (banking as a service, “BaaS”) to businesses and innovative enterprises.

Legal affairs

Obligations and requirements to provide online-banking services described above

According to the Regulation, in order to be able to obtain a license, digital banks must meet all the conditions for credit institutions, which is defined as deposit banks and participation banks, under Article 3 of the Banking Law, unless otherwise stipulated. The general conditions for establishment and operating permits of digital banks are the conditions for obtaining establishment and operating permits of banks in Regulation on Indirect Shareholding And Transactions Subject To Permission Of Banks (“TSP Regulation”). According to the TSP regulation, in order for a digital bank to obtain a license, a petition of application must be filed to the BRSA for foundation of a bank in Turkey. It is required to be accompanied by:

    a. business plans analysing the benefit expected from foundation of bank, and describing which operations and activiti
ly or indirectly holding qualified shares therein, and the rates and amounts of their shares, and if any, privileged shares, and detailed descriptions about their fields of activity, investment and operational areas, and their balance sheets and income statements of the last three years approved by sworn financial advisers licensed according to the Law no. 3568, and a report issued by one of the rating companies, if any, for legal entity founding partners classified as a bank or financial institution;

k. consolidated or non-consolidated balance sheets and income statements of the last three years, if any, approved by an independent audit firm, of the group covering legal entity founding partners of bank, and affiliates of that group; and

l. tables indicating the shareholding structure of legal entity founding partners of the bank up to their natural person partner or partners, and lists showing their privileged shares, or if they do not have any privileged shares in capital, a statement in relation therewith; and

m. certificates to be received from the relevant tax departments and the Social Security Agency verifying that natural person or legal entity founding partners of the bank, and natural persons directly or indirectly holding qualified shares in legal entity founding partners of the bank do not have any overdue or outstanding tax or insurance premium debts; and

n. income and/or corporate income tax returns of founding partners issued for the last five years and approved by the relevant tax departments, and their exhibits, and real estate tax returns issued for real properties owned by them and approved by the relevant departments of municipalities, and if deemed necessary by the Agency, a certificate to be received from the relevant land registries, containing land registry records of and annotations and encumbrances on the aforesaid real properties; and

o. certificates to be issued by the relevant banks to the name of the Agency, all of them bearing the same date, for confirmation of information given in founder’s statements about deposit and credit accounts of founding partners subscribing for ten percent or more of capital of the bank, in such manner to also contain the opening dates of these accounts; and

p. report to be issued by sworn financial advisors licensed according to the Law no. 3568 about financial situation of founding partners subscribing for ten percent or more of capital of the bank; and

q. information and documents required to be furnished to the Agency about directors and general manager, if nominated, to be assigned and appointed, pursuant to Articles 4 and 6 of the Regulation on Procedures and Principles Regarding Notification, Oath and Declaration of Property, of Individuals to be Appointed to Top Management of Banks, and Keeping of Decision Books by Banks; and

r. copies of powers of attorney granted to person or persons authorised to represent natural person or legal entity founding partners of the bank; and

s. a statement to be issued and signed by founding partners subscribing for ten percent or more of capital of the bank, giving information as to how they are going to find the required financial sources, and verifying that they have found these financial sources out of their own commercial, industrial, and other legal business activities and free from any kinds of collusion, in accordance with the format given in Annex-4 attached hereto; and

t. in the case of founding partners being a bank or a financial institution established abroad:

  • their business plans analysing the benefit expected from foundation of the bank, and describing which operations and activities will be carried out, and how internal audit, internal control and r

Authors

Close

Choose country