Co-founder of FinTech istanbul
The FinTech Istanbul platform aims to provide the key components necessary for the growth of Turkey’s Financial Technologies Entrepreneurship Ecosystem and is the leading organization in the financial technology sector in Turkey. Ihsan Elgin, co-founder of FinTech Istanbul, provides insights about the organization, its focus, and future trends.
Can you please tell us more about FinTech Istanbul? When was it founded, what does it focus on, and how does it support the local fintech scene?
The “FinTech Istanbul” platform was founded in 2016 to bring together all important building blocks necessary for the healthy growth of the Turkish Financial Technologies Entrepreneurship Ecosystem. The platform set off with leading names , dedicated in the fields of education, entrepreneurship and data analysis and adopts a structure which is open for cooperation with every new individual and company that might serve this purpose.
What are the most important current developments in the fintech startup community in Turkey?
The number of fintech startups increased fast in recent years (information from the startup market intelligence website). For a long time, fintech startups focused on the payment ecosystem. Especially payment companies became the main driver of the fintech industry in Turkey. Now, we are witnessing the transformation of the banking & finance industry.
There are 346 fintech startups (information from the startup market intelligence website) in Turkey. If you look at the newly founded startups you can easily see that the core industry they serve consists of various industries like credit scoring, SuperApps, digital wallets, small and midsize business solutions, and account management other than sole payment solutions.
Where is the fintech focus, what are the topics you see as the most prominent?
Meanwhile, banks are discovering the true potential of fintech startups and the benefits they can provide too, so we see an increase in the number of partnerships.
Money is everywhere but keeping it invisible is more important than ever. There was a time when the fintech industry was associated with payment services. But right now we know that everywhere you use money, there are many possibilities for fintechs to offer a service. Therefore, fintechs are evolving rapidly in every aspect.
How did fintechs in Turkey respond to COVID-19: did the crisis stimulate new concepts, ideas and start-ups or did it have a negative effect on such new developments?
The fintech industry is one of the main industries which highly benefited from the pandemic. While traditional financial institutes are failing in Turkey, fintech took over the market by using the power of digitalization. For years fintech was trying to push consumers and businesses to the digital financial world. If you step in the shoes of a fintech you can easily understand that dealing with a massive market with limited resources is a countless effort.
But from the very beginning of the Covid-19 crisis, the merchants turned to the digital world and tried to find alternative solutions to be able to keep their business alive. And the behavior change on the consumer side was tremendous. At the end of the day startups with fully digital products and services, focusing on solving the real problems of people, win the race.
What are some trends you see with Turkish fintechs expanding abroad? Do you have some examples of how this was done well by a fintech? Additionally, do you see the trend with fintechs expanding to Turkey?
Until today we didn’t see many examples of Turkish fintech expanding abroad. While Buy Now Pay Later (BNPL), loan, and alternative payment methods are becoming trend abroad, in Turkey we were dealing with different issues due to the nature of the financial industry. It should take into account that the regulations are different abroad. That’s was another challenge for our startups. But right now technical service providers, scoring services, Robo advisors, and investment-focused fintech startups are catching the international trends and find a way to present themselves.
On the other hand, SuperApp and BNPL come from abroad.
In your opinion, what are the most interesting fintechs from Turkey we should keep an eye on in the upcoming years?
Figopara, Birleşik Ödeme, Colendi, BizimHesap and Akıllı BES/More Wealth will be the next shining stars. Every one of them is focusing on a niche area and solves unique problems in their market. Moreover, they are carrying the potential of being international, so in near future, we’ll see that these startups are expanding into new markets abroad. This will create a huge opportunity to catch the interest of international players and investors. In Turkey, we follow the latest trends in the payment industry for years and our adoption rate is amazing. I believe that a Turkish fintech startup will prove FinTech Istanbul’s success in the international area soon success in the international area soon.