Turkey: Islamic Finance In Turkey: Some Practical Considerations

With the support of the government to develop Islamic finance in Turkey, Turkish and foreign investors are becoming more and more aware of Islamic financing methods and products in Turkey. The main legislation regulating Islamic banking in Turkey is the Banking Law No. 5411 (the "Banking Law"). Regulated under the same legal framework, participation banks must establish their own financing models approved by shariah scholars, to the extent it is in compliance with Turkish laws. Due to lack of specific regulations on Islamic finance, financing offered by participation banks has its own obstacles. Despite legal and practical issues yet to be resolved, Turkey is determined to increase its standing in the Islamic finance market.