| The Regulation on the Operating Principles of Digital Banks and Service Model Banking (“Regulation”) published in the Official Gazette dated 29.12.2021 and numbered 31704.
With the Regulation, the procedures and principles regarding the activities of branchless banks, which only serve through electronic banking services distribution channels and the provision of banking services to financial technology companies and other businesses as a service model have been determined.
Within the scope of the Regulation, digital banks are provided with the opportunity to perform all the activities which credit institutions can perform, depending on whether they are deposits or participation banks, unless otherwise stated in this Regulation or related sub-regulations.
In accordance with Article 5 of the Regulation, some activity restrictions and exceptions to these restrictions have been introduced to digital banks. In this context, credit customers of digital banks can only consist of financial consumers and SMEs.
With article 6 of the Regulation, digital banks are required to establish at least one physical office to handle customer complaints. In addition, digital banks were given the opportunity to serve their customers through the ATM networks which digital Banks would establish themselves.
Pursuant to Article 7/1 of the Regulation, the pledged durability percentage for online banking and mobile banking distribution channels of digital banks cannot be lower than 99.8%
The general conditions of establishment and operation permit of digital banks are the conditions for obtaining establishment and operating permits of banks in Regulation on Transactions Subject to Permission and Indirect Shareholding of Banks. The minimum paid-up capital required for digital banks to obtain an operating license has been determined as one billion Turkish Liras, paid in cash and free of any collusion. In Article 8/2, it is stated that the Board may stipulate that the applicant must sign an information exchange agreement with the Risk Center if the applicant’s controlling partners are legal entities providing technology, electronic commerce, or telecommunication services.
In the 13th article of the Regulation, the principles of Service model banking are regulated, and in accordance with the relevant article, the Service bank will be able to provide service model banking services only to domestically localised interface providers and solely within the framework of its own operating permits.
The status of existing banks is regulated in Article 14 of the Regulation, and banks that have obtained an operating permit other than digital banks and are able to provide services through their physical branches within the framework of their current operating permits, will not need to submit a separate application within the framework of this Regulation. For the said banks, the provisions of this Regulation regarding digital banks will not be applied.
You can access the full Turkish text of the regulation from the link below.