Turkey payments system TROY is live: cashless society by 2023

The card payment system announced by Turkey in 2015 has gone live. Behind the development of Turkey’s Payment Method or “TROY” that brings together all banks within the country was BKM (The Interbank Card Center of Turkey), a 26-year old clearing and settlement services firm, born in 1990 of a partnership between 13 public and private Turkish banks.

The project is aimed at spurring independence, cost-effectiveness, and innovation, as well as strengthening competition in Turkey’s payments market. While 98.5 percent of all 5 billion transaction volume generated in Turkey is domestic, TROY allows banks to choose any international card scheme partners they wish. Decreasing costs to issuing banks, eCommerce payments, contactless and biometrics are factors of potential success for TROY.

“Make a transaction over a POS terminal, an ATM or the internet and, whether you are paying or being paid, your transaction will be processed in a secure, rapid and problem-free way. Moreover, it will be unique to Turkey. The winner will be Turkey”, said Soner Canko, GM at BKM, adding that the firm has reached agrements with 29 banks to offer TROY-branded cards over the next months.

The first phase includes mag-stripe debit cards, but the goal is to transition to EMV chip and PIN cards. If adherence to TROY proves successful with high volume of card issuance, integration with other mobile payment methods would be expected, and potentially the national payment scheme will be part of the country’s digital wallet.

Canko’s ambition proved to be high with the following remark: “We aspire to create a cashless society by 2023. In the future, when we look back to today, we shall remember with pride this meaningful moment when Turkey’s Payment Method was launched.”

The national payments system in Turkey follows pioneers such as Canada, Italy, Spain and South Korea. According to Canko, BRICS countries (Brazil, Russia, India, China, and South Africa) are also considering taking the same steps.  The higher the volume of payments under TROY, the lower is the potential parallel economy and inflation. BKM hopes to boost the use of electronic money in a way that Turkey would no longer need cash by 2023.

Tukey has 171 million bankcards overall, with 112 million being credit cards. Total volume was of $375 billion, but card payments continue to constitute the minority of all transactions, at 40%.