Can Fintech Promote Sustainable Finance? Policy Lessons from the Case of Turkey

This study contributes to sustainable finance literature by exemplifying promotion of sustainable finance through fintech solutions for emerging market economies by presenting the case of Turkey. Turkey is one of the largest emerging market economies in the world with a strong banking system and high adoption of technology, so it has great potential to benefit from fintech solutions to boost sustainable finance. For the case analysis, the data used came from a research platform for a Turkish start-up ecosystem, Turkish regulations, and documents released on Turkey's sustainable finance strategies by Turkish and international institutions. We found that Turkey has made remarkable progress in increasing financial inclusivity for underbanked individuals and SMEs via providing contactless payment and contract systems and microfinance by mobile carriers and other online platforms. Turkey was also able to promote the responsible consumption goal for sustainable development by improving fintech solutions on payment systems with educational content on this goal. With upcoming developments such as the sandbox environment in Istanbul Financial Center, fintech solutions using Big Data, AI, and blockchain could emerge much faster with collaboration between banking and fintech sectors and regulatory institutions to better assess climate-related financial risks and form a national carbon trading mechanism.