Deep Dive: Digital Tech And Payments In Turkey

Turkey has a young population, a rapidly growing bankcard market, high mobile phone penetration and a robust economy. All of these credentials have prepared Turkey, soon to be inaugurated into the European Union, to become a leader in Europe for contactless card adoption and new mobile NFC payment solutions.

This deep dive aims to give insight to a day in the life of Turkish technology, and to break down how its banks and mobile operators are working to better accommodate payments for consumers in the country. How is Turkey becoming a payments haven? takes a closer look into a report released by Gemalto, based on 2012 data.

We are stopping the clock—but only for 0.5 seconds, which is also the average time it takes to make a contactless payment in Turkey—to study the Turkish world.

Contactless Revolution

Garanti Bank, the second largest bank in Turkey, was the first in the world to launch a contactless card that features mChip Advance solutions from MasterCard. This card allowed for banking cards to become transportation cards, eliminating the extra step of purchasing tickets for city transit. Commuters were able to get on the train and go with just a tap of a bankcard.

Turkey currently has over 40,000 contactless terminals. Garanti Bank has deployed over 5 million contactless cards, while another large Turkish bank, Bank Asya, has deployed over a million.

Emre Ozgur, senior VP of Bank Aysa’s marketing, insisted, “If you want to be successful in the this payment systems market, your products have to be different. That’s why we choose to invest in new technologies.”

The Rise Of Mobile NFC

In 2010, Garanti and mobile operator Avea launched the world’s very first NFC-capable SIM card. After the roll out, Turkish customers were able to purchase prepaid SIM cards that allowed them to make NFC payments. In 2012, about 50 percent of POS terminals shipped into Turkey were NFC-enhanced.

Attila Algan, product marketing director at AVEA, stated,” We wanted to enable our customers to use their mobile phone as part of their daily life.”

Rising To eBanking Security Demands

The number of online users and how they’re using the Internet to pursue financial transactions is continuously evolving. The pressure to improve security measures becomes heightened as online payments become more common. Financial institutions are expected to provide more services that authenticate and protect their identity and information.

In response to consumer demands, Turkish banks implemented mobile signatures and electronic identity cards. EID cards have a microchip that contains customer identity data, and the mobile signature enables the mobile phone SIM card to create one-use passwords for each transaction.

Turkey was one of the first markets to introduce these security services and has managed to stay consistent with new developments. Turkcell, the largest mobile phone operator in Turkey, has the largest mobile signature program in the entire world and shows no signs of slowing down. Turkcell continues to launch new security standards for online banking.

To read the full Gemalto report click here.


Latest Insights:

Our data and analytics team has developed a number of creative methodologies and frameworks that measure and benchmark the innovation that’s reshaping the payments and commerce ecosystem. In the December 2019 Mobile Card App Adoption Study, PYMNTS surveyed 2,000 U.S. consumers for a reveal of the four most compelling features apps must have to engage users and drive greater adoption.

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