Draft Regulation Amending the Regulation on Debit Cards and Credit Cards is Published

On 28.10.2022, Banking Regulation and Supervision Agency published the Draft Regulation Amending the Regulation on Debit Cards and Credit Cards (Draft Regulation) on its website to receive market players’ comments.

Certain amendments introduced by the Draft Regulation are summarized below:

• The Draft Regulation introduces the card scheme definition which is stated as follows, “the set of rules, practices, guidelines, and standards that enable card-based payment transactions, covering the management and decision-making bodies responsible for its operation and the organizational structure independent of the infrastructure and payment system supporting the operation of a card system operator”. 
• Within the proposed amendment introduced by the Draft Regulation, the card issuers cannot issue cards to be used by their customers in Turkiye in such a way that they are solely linked to the card scheme of a card system operator which has not obtained an operating license in Turkiye. Nevertheless, this is possible if a licensed card system operator’s card scheme in Turkiye is linked to these cards in question. Additionally, if a card brand is to be included on the card, all card brands with which the card is linked need to be included.
• The Draft Regulation indicates the domestic use of a card when there is a transaction through the POS of an organization that has obtained an operating license as an acquirer in Turkiye.
• If the Draft Regulation enters into force, during the application process, card issuers must offer the customer a choice regarding the card scheme. Card issuers are also required to inform the customer clearly and objectively about the functions, costs, customer rights, and security features of all card scheme options, including the domestic and international use of the card.
• If the amendments introduced by the Draft Regulation enter into force, organizations that issued cards prior to the effective date of the amendments will be exempt from the above-mentioned requirements. However, if the cards are renewed after the adoption of these amendments, the exemption shall not apply.
• Another important amendment proposal to be introduced by the Draft Regulation is that in the activities of acquirers residing abroad addressed to persons residing in Turkiye, card issuers can approve the transaction requests coming from the POS allocated to the acquirers residing abroad only if such requests come through the POS of an organization that has obtained an operating license in Turkiye. The Draft Regulation sets out the types of activities that may be considered as activities directed to persons resident in Turkiye.