Recently, very important developments and new initiatives in the field of payment systems have been drawing attention. With the effect of these developments, it is undeniable that the transformation and progress in payment systems will accelerate in the coming years, and that end users will benefit the most from it.
As a result of these developments, I think we will see a new Unicorn, or several Unicorns, emerge from Turkey in the field of payment systems.
So, in earlier periods, were there developments in payment systems in Turkey that changed customer habits?
Yes, there were. Cardholders loved this development.
So what did this development involve?
This development, which allowed purchases to be paid for in installments with a credit card, was revolutionary for cardholders.
Does everyone assume that installment credit cards are issued by banks?
Almost everyone thinks so. However, the fact that the first installment credit card did not come from a bank actually increases the chance that new initiatives and ventures can be independent of banks.
Let's look together at how the first installment credit card came about in Europe and in Turkey.
The card we are talking about is the Advantage card, which many of us remember from its catchy jingle, “if you have the advantage, you have the advantage.”
The first seeds of the Advantage Card were planted by having people with a regular income, mainly in Ankara and the public sector, sign promissory notes and pay in installments, and the goal was approached with Carsi Kart. Boyner Holding launched the Advantage Card, an installment credit product, through Benkar Consumer Finance and Card Services, which it founded in 1998.
The company signed a revolutionary project in the business world with Carsi Kart, a store card that offered installments, allowing Carsi customers to make their purchases in installments at the cash price. In 1998, Carsi Kart was renamed the Advantage Card, and thus the Advantage Card became the first installment credit card in Turkey and Europe.
Boyner Group made the Advantage Card younger and launched the Advantage Campus Card for university students aged 18-25 who were citizens of the Republic of Turkey. As the first installment card aimed at students, the Advantage Campus Card's features included being available without a guarantor and with a school ID card.
Holding 9 percent of the credit card market, with more than 400 member brands or companies in its system, Benkar, the issuer of the Advantage Card, was known as the largest card organization outside the banking sector, with its Call Center, Credit Risk Management Unit, marketing units and 500 employees. It was the pioneer of the installment credit card market in Turkey.
The Advantage card, which reached nearly 1 million members in less than two years, was sold to the Hong Kong and Shanghai Banking Corporation (HSBC) in 2002.
When it was sold to HSBC in 2002, the Advantage Card had 288 member merchants and more than 1.5 million users, making it the largest card organization in Turkey outside the banking sector. This success, which started outside the banks, became the most important product of the banking sector. In addition, after this sale, the Advantage Card went beyond the scale of Turkey.
With an annual turnover of 1 billion dollars, the Advantage Card was among the three institutions with the best credit card portfolio in Turkey. Setting an example for banks in Turkey, the Advantage Card paved the way for all banks to adopt this system. As the leader in its field at the time, the Advantage Card led banks to introduce, for a period, a cash reward rebate system similar to a tax refund.
By increasing purchasing power, the Advantage Card both revitalized the market and gave people in Turkey the opportunity to raise their standard of living, and it went down in history as the first installment credit card in Europe and Turkey.
So what can we conclude from looking at these developments?
Considering these developments, the lessons to be drawn are:
- New ideas and applications can come from our country too. We only need to believe in ourselves and strive to succeed.
- Let's not expect innovation in payment systems only from banks; let's believe that new fintechs can also give payment systems serious momentum.
- Let's take our steps knowing that the prerequisite for being an entrepreneur and for a venture to succeed is to clearly identify customer needs and produce a solution that fits those needs.
- Let's keep in mind that the Advantage card example above emerged at a time when digitalization had only just begun, that digitalization is now part of every moment of our lives, and that it is therefore important to offer new products and services and digital products that will surprise customers.
- Finally, let's stay aware of customer needs by continuously researching new technologies and trends. Who knows, you might be the pioneer of a new venture.
