Digital Banking Overview and Potential in Turkey

Digital banking will remain on the agenda for some time, and a winning strategy should answer five critical questions in order to be meaningfully differentiated in the competitive banking sector.

Digital transformation gained momentum with COVID-19 and made a significant difference in every industry including banking. At the same time, banks focused on maintaining their business processes as well as developing solutions to serve their customers via various platforms.

The banks that are driving digital transformation changed the ways they do business and expanded their services and the customer segments they appeal to, while other banks that rejected change and struggled to keep up lost market share.

The Banking Regulation and Supervision Agency (BRSA) defines digital banks as “credit institutions providing banking services mainly via electronic banking service distribution channels instead of physical branches”. With the regulation issued by BRSA, digital banks have recently become popular in Turkey as in the rest of the world. The feasibility of the digital banking business model has increased with the “Remote Customer Acquisition” regulation issued in May 2021 and with the wet signature becoming redundant, which was an additional cost item for all banks including digital banks. 

Three important reasons to think digital banking is popular among individual customers in Turkey:

  • In 2020, 37% of personal consumer loans in Turkey were provided via digital channels.
  • In our survey conducted on September 2021 with participants from Turkey,
    • 55% of the participants said they don’t visit any bank branches,
    • 70% said they would be willing to use a digital/branchless bank if it offered a better value proposition.

Critical questions to evaluate before establishing a digital bank: 

  • What kind of a business model should we use?
  • How will it differ from hybrid model banks and other digital banks?
  • Which customer segments should we aim for?
  • What kind of product portfolio should we offer?
  • What should the pricing strategy be?

Business Model 

There are three business models used around the world:

Basic Banking Solution Providers
Platform Players (Superapp)


Basic Banking Solution Providers

These kinds of digital banks focus on products that are relatively easy to use, such as deposits, bill payments and money transfers. They aim to grab the short attention spans of customers. Their important parameters for customer acquisition and retention are innovative design, a better customer experience and the brand image.

Platform Players (Superapp)

Platform players choose to become Superapps to expand their services and customer databases, as well as to provide main banking solutions. They provide some non-banking products and services themselves and collaborate with third parties for others. The digital wallet, a payment system product, is a key product for these banks.


These banks focus on a certain customer segment in a country, such as small business owners or specific age groups. The product portfolio they provide to satisfy the chosen customer group’s needs is quite large. The amount of time it takes them to reach profitability globally is shorter than in the other models.

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Ozan Cığızoğlu

Ozan Cığızoğlu

Territory Leader, Strategy& Türkiye

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