KEY STATISTICS

Operator: Turkcell

Country: Turkey

Launch date: In June 2011, Turkcell launched a wallet service, called Cep-T Para. In October 2012, the Turkcell Wallet began to support Near Field Communications (NFC)-based services.

Services offered: Online and point of sale payments, money transfers, couponing, bill payment, transportation cards and pre-paid mobile account top-ups.

Target customers: Turkcell subscribers

TSM provider: Turkcell, BKM or other TSMs

Operating system: Turkcell Wallet’s SIM application is designed to work with any handset, but it also offers a native wallet app for the Android, BlackBerry and iOS operating systems.

Handset compatibility: Turkcell Wallet is designed to work on all mobile phones. However, NFC-enabled phones are required for contactless transactions.

Executive summary

Turkcell, Turkey’s largest telecoms company, was one of the first mobile operators in Europe to deploy a commercial mobile wallet service. In June 2011, Turkcell launched its Cep-T Para Wallet and added support for NFC-based services in October 2012. More than one million customers have since registered to use the wallet. Turkcell send SMS and emails to inform customers of relevant offers in the wallet linked to their current location.

The Turkcell Wallet supports online and point of sale transactions, money transfers, couponing, bill payment, transportation cards and pre-paid mobile account top-ups. The wallet is also a marketing channel for merchants and brands: Turkcell delivers up to five offers a day to its wallet subscribers tailored to their preferences and behaviour. Turkcell also plans to enable the wallet to support merchants’ loyalty cards.

Turkcell’s NFC services employ a secure element on the consumer’s SIM that complies with the payment industry’s EMVCo standards for banking transactions. “Putting the secure element inside the SIM adds a very powerful layer of protection,” says Hakan Tatlici, Product Manager for Turkcell Wallet. “It’s like having a locked draw in a desk inside a locked room. I don’t think the others can compete with this.”

Turkcell estimates that approximately 3% of Turkey’s two million point of sale terminals support NFC today. Although that figure is rising, Turkcell says a lack of standards is making it difficult to equip the existing contactless terminals, which are owned by different banks, to support non-payment applications, such as couponing and loyalty services. “The number of non-payment applications has been limited by a lack of standards – a really big problem,” says Hakan Tatlici. “Since mass transit applications are used on a daily basis, we think they will be the catalyst for greater penetration and we launched the first transportation service for Turkcell Wallet in May 2013.”

One of Turkcell’s immediate priorities is to enable its mobile wallet to support all the debit and credit cards available on the Turkish market. Turkcell is also planning to expand the suite of applications supported by its wallet. “In the near future, users will be able to add corporate access cards and restaurant cards into their Turkcell Wallet,” says Hakan Tatlici. “We also plan to enable a NFC handset with a Turkcell Wallet to be used in place of home and car keys for access control. We also have plans for more mass-transit ticketing and loyalty and couponing applications.”

Turkcell’s ultimate goal is to make the wallet absolutely integral to its customers’ lives. “We envisage Turkcell Wallet in Turkey will be involved in every sphere of life and will be a replacement for the physical wallet in the near future,” says Hakan Tatlici.

CASE STUDY: TURKCELL MOBILE WALLET

For further information please contact: mobilecommerce@gsma.com

GSMA London Office T: +44 (0) 20 7356 0600 www.gsma.com/mobilecommerce

CASE STUDY: TURKCELL MOBILE WALLET

A mobile wallet pioneer

Turkcell, Turkey’s largest telecoms company, was one of the first mobile operators in Europe to offer its subscribers a mobile wallet service. In April 2011, Turkcell launched its Cep-T Cuzdan NFC services for smartphone users, followed by a wallet service, called Cep-T Para, in June 2011. Cep-T Para comprised a pre-paid card linked to a mobile account, supporting text-based alerts, payments and money transfers. In October 2012, Turkcell combined these services, enabling consumers to use the Turkcell Wallet to make both remote payments and contactless transactions via NFC at point of sale. More than one million customers have since registered to use the wallet.

The Turkcell Wallet can store a range of payment cards, including credit cards, tickets and ID cards. Subscribers can also add a Turkcell virtual prepaid card to the wallet and top it up at ATMs. Once they have added a payment card, consumers can use the wallet to initiate online transactions by entering a mobile phone number linked to the chosen card stored in their wallet. The user then receives a text message on their phone asking them to confirm the payment by entering their PIN number. Turkcell says that many of its customers regard this process as more secure than conventional online payments because they don’t have to share their payment card details with the web site.

The Turkcell Wallet also supports (via SMS or an Internet connection) person-to-person money transfers and bill payments. Money transfer recipients can withdraw the cash they receive from Garanti Bank ATMs – one of the largest ATM networks in Turkey. Subscribers can also use the wallet to check the balance of linked bank accounts and the most recent 10 transactions logged on their transportation cards. They can also top up the latter directly from the wallet, paying through their Turkcell account or with a payment card stored in the wallet.

Turkcell Wallet is also designed to be “a fast and easy-to-reach platform” for other Turkcell telecoms services, enabling prepaid top-ups and the purchase of data and SMS packages, together with Turkcell Group bill payments.

The wallet is also designed to be a marketing channel for merchants and brands: Turkcell delivers up to five offers a day to its wallet subscribers reflecting their preferences and behaviour. They can also browse a catalogue of valid offers. If the consumer wants to redeem one of the offers, they give the related code to the relevant merchant. Turkcell also plans to enable the wallet to support merchants’ loyalty cards.

Not just for smartphones

Turkcell Wallet is available as a SIM-based application, designed to work on all NFC-enabled mobile phones. If a Turkcell customer sends an SMS to a short number with a keyword, they then receive messages instructing them how to set up the wallet and update the SIM menu on their handsets so it can be used for transactions.

Alternatively, subscribers can use a native application on smartphones running the Android operating system, BlackBerry OS or Apple’s iOS. Turkcell has commissioned several own-brand NFC-enabled mobile phones, which have the Turkcell Wallet application pre-installed, while several other smartphones ship with an icon, which consumers can click on to install the app. Android and iOS users can also download the wallet from an app store. Consumers can then add their MasterCard-branded credit or debit cards to the Turkcell Wallet through bank point of sale terminals and ATMs. Virtual prepaid cards can also be activated via these channels. Turkcell says that customers who use a MasterCard for prepaid top-ups are offered the opportunity to download the wallet and add their credit or debit card directly.

To use the wallet for contactless payments at point of sale, a consumer needs an NFC-enabled phone and an NFC-enabled SIM card (sometimes called an Universal Integrated Circuit Card or UICC). Moreover, the merchant will need a compatible point of sale terminal. The wallet’s NFC-based services are secured using a secure element on the consumer’s SIM that complies with the payments industry’s EMV standards for banking transactions. “It’s been proven that wallets stored in an app or an operating system can be hacked,” says Hakan Tatlici, Product Manager for Turkcell Wallet. “Putting the secure element inside the SIM adds a very powerful layer of protection. It’s like having a locked draw in a desk inside a locked room. I don’t think the others can compete with this.” The wallet also uses the Mifare Classic protocol to secure access controls and ticketing applications.

Turkcell is also trying to make it straightforward for service providers to offer NFC-based applications: Turkcell is one of the few mobile operators to have developed its own trusted service manager (TSM) service. “Owning our own infrastructure and wallet solution will shorten the time it takes to integrate and introduce new applications,” says Hakan Tatlici. “However, Turkcell can not create the entire ecosystem and can not force service providers to use our own solution, so we have established an architecture that is open for cooperation.”

Since the launch of its wallet service in 2011, Turkcell has run many promotional campaigns, highlighting the benefits of NFC devices and digital bank cards, as well as providing customers with free NFC-enabled SIM cards. However, Hakan Tatlici says NFC-enabled SIMs still need to come down in price to enable telcos to distribute NFC to a mass market.

CASE STUDY: TURKCELL MOBILE WALLET

Next steps to expand the ecosystem

One of Turkcell’s immediate priorities is to enable its mobile wallet to support all the debit and credit cards available on the Turkish market, so consumers don’t need to have an account with a specific bank to use the wallet. “This will enable the wallet user base to grow faster, while expanding our online and face-to-face shopping network,” says Hakan Tatlici. Turkcell is also looking to roll out the wallet service in other countries beyond Turkey.

At the same time, Turkcell is planning to expand the suite of applications supported by its wallet. “In the near future, users will be able to add corporate access cards and restaurant cards into their Turkcell Wallet,” says Hakan Tatlici. “We also plan to enable a NFC handset with a Turkcell Wallet to be used in place of home and car keys for access control. We also have plans for more mass-transit ticketing and loyalty and couponing applications.”

To encourage usage, Turkcell’s latest own-brand phone ships with a NFC tag embedded into a refrigerator magnet. When the consumer taps the phone against the magnet, a mobile shopping application opens on their handset and lists products from participating food and drink merchants.

Turkcell’s ultimate goal is to make the wallet absolutely integral to its customers’ lives. “Turkcell Wallet will open the door to a new era in shopping and e-commerce as an inventive commercial platform on which all of Turkey’s leading brands and banks will be available,” predicts Hakan Tatlici. “We envisage Turkcell Wallet in Turkey will be involved in every sphere of life and will be a replacement for the physical wallet in the near future.”

The App User Interface

In the Turkcell Wallet smartphone app, a consumer can access all the main functions at any time via a menu at the bottom of the screen. The menu options are:

Daily Deals: Touching this tab enables the user to see and respond to daily deal offers. They can also save offered coupons to their coupons tab for later use.

Coupons: Touching this tab enables the user to see a list of all coupons they have added from the daily deal offers. They can use valid coupon codes during their shopping.

Cards: Touching this tab enables the user to add payment cards and see all the cards they have added.

Transactions: Touching this tab enables the user to see past financial transactions, such as money transfers, top-ups and packages purchased.

Profile: Touching this tab enables the user to view and edit their personal profile.

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For further information please contact: mobilecommerce@gsma.com

GSMA London Office T: +44 (0) 20 7356 0600 www.gsma.com/mobilecommerce

September 2013