Top 3 Money Transfer Providers for UK to Turkey

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Summary

The Turkish government does not apply restrictions on foreign exchange transactions, and capital invested in Turkey may be freely repatriated. Money transfer to Turkey and sending money from Turkey can therefore be freely done.

Turkey’s money transfer regulations

Individuals and corporations, both resident and non-resident, are able to hold bank accounts in foreign currencies. There are no restrictions on transferring capital out of Turkey, but this must be declared to the Undersecretariat of the Turkish Treasury within three months following the transfer.

The Central Bank of the Republic of Turkey (CBRT) adopted a free float exchange rate policy in 2001 and reaffirmed its commitment to a free market rate in 2014, despite the pressure on its currency. The lira is fully convertible, which makes sending money to and from Turkey relatively simple.

Turkey’s monetary and regulatory authorities

The Central Bank of the Republic of Turkey (CBRT) is responsible for determining monetary policy, monitoring and ensuring the health of the financial system, preserving price stability and maintaining healthy levels of foreign exchange reserves. An independent agency under the purview of the central bank, the Banking Regulation and Supervision Agency, monitors the application of financial regulation and the stability of the banking sector.

While capital flows are relatively free, reporting requirements can be more onerous than in many countries. All transactions between residents and non-residents must be reported to the Central Bank for balance of payments purposes on a monthly basis. Direct investments and loans are reported on an individual basis, as are foreign currency transactions (not reported as imports, exports, trade in services, and capital flows) in excess of US$50,000. Banks are responsible for submitting transactions data to the central bank on behalf of their corporate clients, and companies are required to maintain documentation to support their transfer pricing. large taxpayers must present an annual report detailing both domestic and foreign transactions.

Foreign exchange volume

On Turkish exchange platforms, the most frequently exchanged currencies include US dollars (USD), Turkish lira (TRY), euros (EUR) and Japanese yen (JPY). The most recent survey from the Bank for International Settlements indicates that lira are most often exchanged against USD and EUR.

Turkey’s economic background

Turkey’s economy has grown rapidly in the last decade, and it has joined the ranks of the world’s major emerging economies. Turkey has attracted rising levels of foreign direct investment (FDI) and the value of the lira, improved considerably following the country’s 2001 banking and currency crisis. The ruling party, the Justice and Development Party (AKP), aims to establish Turkey as the 10th largest world economy by 2023, the centennial anniversary of the Turkish republic; as such, the country is expected to remain firmly open to foreign investment, trade and currency exchange.

However, Turkey experienced the same issues as other emerging countries such as Brazil, India, South Africa and Indonesia related to capital flight in 2013-14. The announcement in May 2013 that the US Federal Reserve would begin reducing its bond buying programme that it adopted following the onset of the global economic crisis in 2008 led to a sudden withdrawal by panicked investors of assets from emerging economies, destabilising their currencies and eroding their foreign exchange reserves.

Once considered the engines of economic growth during the global downturn, these countries were dubbed the “Fragile Five.” The value of the lira dropped to a record low against the dollar in January 2014 in anticipation of the Fed policy changes; the lira’s value against the dollar had improved by September, though it had yet to regain levels seen in early 2013.

Currency

The New Turkish Lira is the monetary unit of Turkey and the Turkish Republic of Northern Cyprus. The TRY was first issued in 2005, replacing the first Turkish lira (TRL) and removing the last six zeros from the former currency (1 TRY = 1,000,000 TRL). One lira is made up of 100 cents, or kuruş (kr). Banknotes are issued in denominations of 5, 10, 20, 50, 100 and 200 lira. Coins are minted in values of 5kr, 10kr, 25kr, 50kr and one lira.