TURKEY Law and Practice Contributed by: Sera Somay, Merve Kurdak and Doğa Pınarlı Dedebaş, Paksoy
through resolutions, and instructions issued by the Banking Regulation and Supervision Agency (BRSA) and the CBRT. • Other financial institutions, such as financial leas - ing, factoring and financing companies, are subject to their respective sector-specific legislation and supervision by the BRSA. • Capital markets institutions, including investment firms, fall within the scope of the CML and related secondary legislation. The regulatory frameworks applicable to the fintech business models can be summarised as follows: • Payment and e-money institutions operate under the Law on Payment and Security Settlement Systems, Payment Services and Electronic Money Institutions No. 6493 (“Payment Services Law”), alongside applicable secondary legislation. • Open banking services are regulated under the Regulation on Banks’ Information Systems and Electronic Banking Services. • Digital banking and BaaS models are regulated under the Regulation on the Operating Principles of Digital Banks and Service Model Banking. • Crypto-asset service providers are regulated main - ly under the CML and the CMB Communiqués, in addition to applicable AML/CFT legislation. 2.3 Compensation Models Industry participants may charge customers interest, fees, expenses, commissions or other monetary ben - efits only if such charges are contractually agreed and duly disclosed to customers, and only to the extent permitted under the applicable regulatory framework and, where relevant, within the limits or principles set by the competent authority, such as the CBRT, which may determine the types and maximum amounts of such charges for banks and payment service or elec - tronic money institutions. 2.4 Variations Between the Regulation of Fintech and Legacy Players The regulation of fintech industry participants differs from that of legacy players primarily in terms of regu - latory scope, licensing, incorporation and operation requirements, and ongoing obligations.
While banks are subject to a comprehensive pru - dential framework covering the full range of banking activities, fintech participants are generally regulated under activity-specific frameworks. Fintech industry participants are authorised on a limited, service-based basis, with regulatory requirements tailored to the specific activities they are permitted to perform and focused mainly on functional compliance and con - sumer protection. 2.5 Regulatory Sandbox There are no official regulatory sandboxes operated by regulatory authorities such as the BRSA or CMB in Türkiye so that new technologies or players could benefit from regulatory exemptions or exceptions. However, the 2022 “State of the Fintech Ecosystem in Türkiye” report, published by the Presidency of the Republic of Türkiye mentions a sandbox regime to be established by the Istanbul Financial Center. Accord - ingly, Fintech Zone Istanbul was established by the Istanbul Financial Center. It hosts a “Fintech Sand - box” which allows fintech start-ups to test their prod - ucts in real-world conditions and help them comply with the regulations. It does not provide any regulatory exemptions or no-action reliefs. The establishment of regulatory sandboxes is also addressed in the “Tür - kiye 2030 Industry and Technology Strategy” report issued by the Republic of Türkiye Ministry of Industry and Technology, indicating potential future regulatory developments. 2.6 Jurisdiction of Regulators Turkish fintech jurisdiction is delineated among multi - ple regulatory authorities based on the type of finan - cial activity: • BRSA: The BRSA is the competent authority for all banks, including digital banks, open banking struc - tures and BaaS arrangements. Within the scope of the Banking Law, the BRSA regulates the estab - lishment and activities of banks, with a mandate to ensure the effective functioning of the credit system and the protection of depositors’ rights. • CBRT: The CBRT is responsible for the conduct of monetary and exchange rate policies and for safeguarding financial stability in Türkiye. In addi - tion, under the Payment Services Law, the CBRT has jurisdiction over payment systems, payment
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