In recent years, E-Money has been gaining traction as a viable alternative payment method to conventional cash both in Turkey and abroad.
At first, each company started online payment methods by integrating its software within their own websites. However, they required separate semi-agreements with each bank. They also charged monthly membership fees, POS machine maintenance fees, and took a commission from each bank. If the customer’s bank did not have an agreement with a credit card, the customer could receive payment from that website.
Entrepreneurs saw this problem as an opportunity, and their solution was led to the birth of the E-Money payment system.
Paypal, now a household name, is just one of the many examples of E-money payment systems in use today. All you need to do is sign up and link your bank to use their platform.
Then came the next generation payment system: VENMO. Without the need for IBAN and other bank information, people could send and receive money with nothing more than a username. If users did not receive their money within three days, VENMO dropped their commission fees.
Welcome to the E-payment system revolution!
Other big companies soon jumped on the bandwagon. In addition to Paypal, we now have ApplePay, Facebook Messenger, and GooglePay.
One should also mention that the E-Money payment system Square, owned by the founder of Twitter, is incredibly popular with vendors and online retailers throughout the United States. The main difference being that Square implements its own special cash register machine, which enabled them to tap into the lucrative sales sector.
E-MONEY IN TURKEY:
Turkey is home to one of the world’s highest users of the Internet and social media. Unsurprisingly, credit card usage rates in Turkey are some of the highest in the World. As a result, online payment methods have the potential for spectacular growth.
Several companies set up shop in Turkey before the government introduced e-money legislation. Once regulations were ratified and enforced, some companies were able to obtain licenses, whereas others were forced to leave the market.
The payment and electronic money services industry is a newly regulated market in Turkey. Now that the regulators have started issuing licenses to operators and service providers, the industry is expected to grow exponentially over the next few years.
E-MONEY LAW IN TURKEY:
In Turkey, principles and procedures regarding payment institutions and electronic money institutions are regulated under Law No. 6493 and the Regulation on Payment Services and Electronic Money Issuance and Payment Institutions introduced by the Banking Regulation and Supervision Agency (BRSA).
2013 : Law No 6493 on Payment and Security Settlement Systems, Payment Services and Electronic Money (“Payment Services Law”)
The regulation is the secondary legislation of Law No. 6493 on payment services and e-money institutions which came into force in June 2013. Law No. 6493 was drafted based on the European Electronic Money Directive.
2014 : The Regulation on Payment Services and Electronic Money Issuance and Payment (“Payment Services Regulation”)
June 27, 2014, 29043 – Bylaw
June 27, 2014, 29043 – Communique
The Communiqué on the Management and Supervision of Information Systems of Payment Institutions and Electronic Money Institutions, which entered into force after being published in the Official Gazette
Europe’s new Payment Services Directive II (“PSD2”)
An electronic money institution intending to issue electronic money under the scope of this Law can operate provided that it is granted permission by the Board.
BOARD : Banking Regulation and Supervision Board ( BRSA ) Turkish: BDDK
Business Models Under Law No. 6493
Electronic Money: It is defined as the monetary value that is accepted by the real and legal persons other than the electronic money issuing institution and used to perform the payment transactions defined in this Law.
Electronic Money Establishment: A legal person or entity authorized to issue electronic money under the Law.
Other Relevant Laws And Regulations:
Cryptocurrency & E-money Situation:
CryptocurrencLaws not recognized under Turkish law. That is why Cryptocurrency does not fall within the scope of Law no — 6439 on Payment Securities Settlement Systems, Payment Services, and Electronic Money Institutions. There is currently no legislation that is specifically designed to refer to Cryptocurrency, and therefore it is not entirely accurate to declare this type of business activity.
LICENSED COMPANIES IN TURKEY:
There are 17 active e-money institutions listed by the Turkish Banking Regulation and Supervision Agency (“BRSA”) in Turkey.
|18.104.22.168 1.||AKÖDE ELEKTRONİK PARA VE ÖDEME HİZMETLERİ A.Ş.||–|
|2.||BELBİM ELEKTRONİK PARA VE ÖDEME HİZMETLERİ A.Ş.||http://www.belbim.com.tr|
|3.||BİRLEŞİK ÖDEME HİZMETLERİ VE ELEKTRONİK PARA A.Ş.||http://www.birlesikodeme.com|
|4.||CEMETE ELEKTRONİK PARA VE ÖDEME HİZMETLERİ A.Ş.||http://www.cemete.com.tr|
|5.||D ÖDEME ELEKTRONİK PARA VE ÖDEME HİZMETLERİ A.Ş.||https://www.hepsipay.com/|
|6.||ERPA ÖDEME HİZMETLERİ VE ELEKTRONİK PARA A.Ş.||–|
|7.||HIZLIPARA ÖDEME HİZMETLERİ VE ELEKTRONİK PARA A.Ş.||https://www.payporter.com/|
|8.||İNİNAL ÖDEME VE ELEKTRONİK PARA HİZMETLERİ A.Ş.||https://www.ininal.com/|
|9.||İYZi ÖDEME VE ELEKTRONİK PARA HİZMETLERİ A.Ş.||https://www.iyzico.com/|
|10.||OZAN ÖDEME HİZMETLERİ VE ELEKTRONİK PARA A.Ş.||–|
|11.||PALADYUM ELEKTRONİK PARA VE ÖDEME HİZMETLERİ A.Ş.||https://www.peppara.com/|
|12.||PAPARA ELEKTRONİK PARA ve ÖDEME HİZMETLERİ A.Ş.||http://www.papara.com|
|13.||SİPAY ELEKTRONİK PARA VE ÖDEME HİZMETLERİ A.Ş.||–|
|14.||TURK ELEKTRONİK PARA A.Ş.||http://www.turkpara.com.tr|
|15.||TURKCELL ÖDEME VE ELEKTRONİK PARA HİZMETLERİ A.Ş.||–|
|16.||VODAFONE ELEKTRONİK PARA VE ÖDEME HİZMETLERİ A.Ş.||http://eparahizmetleri.com|
|17.||WİRECARD ÖDEME VE ELEKTRONİK PARA HİZMETLERİ A.Ş.||http://www.wirecard.com.tr|
THE E-MONEY INSTITUTION IS SUBJECT TO THE FOLLOWING CONDITIONS OF ELIGIBILITY;
IMPORTANT NOTES :
What to do to open an e-money licensed company in Turkey:
– Open the JSC in Turkey
– Trade Registry
– Notary Transactions
– Increasing Company Capital
– Preparation of the application form for the license
– Following the process from beginning to end
– Preparation of the articles of association and Preparation of all related contracts
– Preparation of the Minutes of the Board Meeting
– Preparation of Activity Certificate
– Contacting relevant institutions
– Tax office applications
– Bank applications
You can see that the future payment system will be in the hands of companies that have e-money licenses.
Obtaining a license also makes you lend you credibility in the eye of the customer. The world of online credit card usage in Turkey is very high, which means there’s more potential to use e-payment services in the future.
It may have the opportunity to take part, and the Turkish market might be your next best investment. However, we recommend that you work with a reputable law firm and consult competent experts before making your final decision,
Founder / Lawyer
GlobalB Law has represented financial institutions, governmental bodies and regulatory agencies since 2014. Our practice areas are extensive, with an emphasis on emerging technologies. As a member firm of New York-based CKR Law LLP, our global outreach spans four continents and 30 countries.
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