With the "Regulation Amending the Regulation on Payment Services and Electronic Money Issuance and Payment Service Providers" ("Regulation") published in the Official Gazette dated October 7, 2023 and numbered 32332, the concept of digital wallet was included in the scope of the legislation as a payment instrument. Pursuant to the Regulation, a digital wallet is a payment instrument that stores information on customers' payment accounts or payment instruments, offers the opportunity to make payments using this information, and can be offered to customers as an electronic device, online service or application.

Among many technology-driven innovations, the digital wallet is revolutionizing the payments industry. Beyond facilitating financial transactions, these exciting developments offer the opportunity to make payments simpler, faster, and more secure. As a result of these developments, the "Digital Wallet" has also gained legal regulation with the recent amendments. With this regulation, the digital payments ecosystem is supported and the competitive environment in the sector will inevitably improve as new domestic and foreign players join this ecosystem. These regulations will also ensure consumer protection by establishing a secure and efficient infrastructure.

Pursuant to the Regulation, digital wallet services may be offered by payment service providers. Within this framework, payment service providers wishing to provide digital wallet services must meet the following conditions:

  • To be authorized to operate in a manner limited to issue payment instruments.
  • If the digital wallet is used as a payment instrument at workplaces and funds are transferred through the digital wallet service provider during the payment, it must be an institution authorized to issue electronic money.

If the digital wallet is valid for direct use of a payment account with another payment service provider or a payment instrument issued by another payment service provider that has been identified to the digital wallet in a payment transaction to be carried out at merchants, the institution must be authorized to initiate a payment order.

Persons who offer digital wallet services before October 7, 2023 and can be considered payment institutions or electronic money institutions but do not have an operating permit must apply to the Central Bank of the Republic of Turkey and obtain the necessary licenses by October 7, 2024. Likewise, organizations offering digital wallet services before this date must to comply with the new regulations by October 7, 2024.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.