Turkey launches its own national payment clearing system

The system, which is called “TROY,” will be operational from 1 April, 2016, the Center said, hurriyetdailynews.com reports. “It is time that Turkey used its [own] payment system,” Soner Canko, chairman of the Istanbul-based BKM, said, the source cites.

Electronic payment cards are processed by merchants, and then sent to a clearing network, which completes the payment. Visa and Mastercard were previously the choice for this operation. But the Turkish banks will be able to clear payments with a new national system.

He said that TROY would be a first for the country, adding that the three-year project constitutes “a historic moment.” “This payment system also is a product of 25 years’ experience,” Canko added, describing TROY as “a strategic step” for Turkey, the source cites.

In Turkey, there are 164 million bank cards in total, with 106 million of these being credit cards. Turks have spent a total of USD 400 billion on debit and credit cards to date. BKM’s CEO said every Turk carries at least two cards in his or her wallet. Yet, still most Turkish people prefer cash payment, as cards only constitute 40 percent of all transactions.

Canko said that the TROY payment system would appeal to those who still choose cash because the fee for using the card will be lower than that charged by the international card networks. In this way, the system will lead to more savings and greater innovation, the source cites.

The system will be managed by the BKM card center but banks will be able to choose the national system or another. He also ruled out any rivalry with Visa and Mastercard. Developed countries including Germany, France and Italy, have launched their own national payment systems as well, according to Canko.

States with similar economies to Turkey, such as Brazil, Russia, India, China and South Africa (the so-called BRICs), have been considering introducing payment systems. Canko said that Turkey would not be the first country to introduce one such system. Canko said the center had received substantial support from the Central Bank, the Banking Regulation and Supervision Agency and banks during the development phase of the payment system.

The BKM was established with the partnership of 13 public and private Turkish banks in 1990. The BKM says that it aims to provide solutions to common challenges of banks and develop rules and standards for credit and debit cards.