Istanbul: Despite facing certain challenges, Trkiye's banking and fintech sector continues to rise as a global powerhouse, supported by a highly advanced financial infrastructure that rivals some of the world's most developed economies, according to a prominent entrepreneur.

According to Anadolu Agency, Trkiye's banking and financial sector is a 'sleeping giant' that is far more sophisticated than it is often credited for, Ozan Ozerk, founder of OpenPayd - a leading global payments and banking-as-a-service platform - and European Merchant Bank said in an interview. Ozerk noted that people living in Trkiye, as well as those in major financial centers like London, Singapore, and the US, may not fully realize how advanced Trkiye's banking system is. He emphasized that Trkiye's financial infrastructure is on par with Japan and South Korea, surpassing that of any European country.

Reports by global financial institutions highlight Trkiye as a high-middle-income nation with strong growth potential, bolstered by its large population and strategic geographical location. Istanbul, in particular, is undergoing a transformation aimed at strengthening its position as a global financial hub, with large-scale projects such as the Istanbul Financial Center (IFC) designed to position the city as a key player in the global finance arena.

Trkiye has also made significant progress in financial inclusion, now boasting more than 100 million credit cards in circulation. This achievement ranks the country ninth globally for credit card transactions and seventh for credit card ownership, according to data from Statista. The nation also has over 90 million active online banking customers and more than 2 million point-of-sale (POS) devices, a significant portion of which support contactless payments.

While Trkiye's traditional banks are well-established and play a crucial role in the financial ecosystem, Ozerk pointed out that they are not able to effectively compete in every sector, creating opportunities for fintech companies and e-money institutions to fill the gaps. Over past years, Trkiye's fintech industry has emerged as a global leader in innovation, leveraging cutting-edge technology to offer new financial solutions. Ozerk explained that fintech and e-money institutions serve customer segments that banks avoid due to risk concerns, such as refugees or high-risk industries.

However, Ozerk also noted that when banks own e-money institutions, it raises concerns about fair competition, 'as it blurs the lines between banking and fintech regulation.' He further stated that Turkish fintech companies are often more technologically advanced than their European and American counterparts, but their international expansion strategies remain flawed. Despite having superior technology and expertise, many Turkish fintech companies fail to adopt the right strategies when expanding into international markets, often entering foreign markets without securing sufficient investment or hiring the right talent.

Although Trkiye's financial sector has shown remarkable progress, Ozerk pointed out that regulatory and legal gaps still pose challenges for further growth. Some financial regulations in Trkiye are either incomplete or outdated, with the cryptocurrency market remaining unregulated for a long time. Despite these hurdles, Trkiye remains one of the world's most promising fintech markets, with a robust digital financial infrastructure.

Ozerk stressed that for the sector to succeed on a global scale, Turkish companies must prioritize stronger investment strategies, better talent acquisition, and well-planned international expansion efforts. Trkiye has the potential to be a major global player in banking and fintech; however, to fully realize this potential, companies must secure more investment, invest in skilled human capital, and implement well-planned strategies for international expansion.