The interest-free baking sector, widely known as participation banking in Türkiye, aims to increase its market share to 10.6% next year, Participation Banks Association of Türkiye (TKBB) Chairperson Osman Çelik said Thursday.
"We aim to increase our market share to 10.6% in 2023 by including digital participation banks in the participation banking ecosystem," he noted.
Çelik told Anadolu Agency (AA) that they aim to increase the employment rate with the growth of the market share and gains in the number of our customers in 2023.
As participation banking, the market share, which was 5% in 2017, reached 8.6% as of September 2022 and the asset size increased to TL 1.1 trillion ($59 billion), he added. "From the end of last year to September of this year, the total number of branches increased by 3.4% to 1,356 and the number of our personnel increased by 1.6% to 17,420, the chairperson apprised.
"Our share of the number of branches in the banking sector was 12.2%. Our share in the number of personnel increased to 8.5%. Thus, we achieved growth above the sector in 2022. We expect this rise in the sector in the coming year as well as plan to continue our work without interruption," he added.
Terming 2022 as a "difficult year" during which individuals and institutions worked hard to get rid of the devastating effects of the COVID-19 pandemic, Çelik said that the Russia-Ukraine war seriously impacted the global economy and supply chains.
He stated that global logistics could not meet the demand adequately and there were supply problems, saying: "We have seen serious global inflation and a shift in economic markets toward recession because of the impact of the war on raw material prices."
"Türkiye is trying to get a bigger share from the trade routes that are switching from China in this process. In order to maintain its economic growth, it focuses on employment, production and exports," he added.
Underscoring that participation banks, which operate within the principles of Islamic finance, contributed to economic growth in 2022, Çelik said: "Under the roof of the TKBB, we also made special efforts to ensure that the participation finance model achieves sustainable growth and that the sector offers world-class financial products and services."
"We intensively worked for the development of our sector that will contribute to the country's economy," he said.
"When only profit-oriented business models lost momentum, the participation finance system, with its unique structure, strengthened its position as a sustainable and innovative alternative within the ongoing existing economies," Çelik added.
Commenting on the expected contributions of the Istanbul Finance Center (IFC), which is expected to open next year, Çelik said: "The IFC will increase the attraction of international institutions, enable the ecosystem to develop rapidly, and will be one of the important centers in the formation of participation finance and new financial architecture."
"Considering both the potential of participation finance and the fact that IFC will become a global financial center, we can make Istanbul an international center in participation finance, with the advantages of its geopolitical position," he added.