A mandatory secure payment system for property purchases will come into force in Turkey on December 1, in a bid to stop fake payment receipts, reversed transfers and the risks of carrying cash.
The Trade Ministry regulation is aimed at fraud in which buyers hand over forged receipts, or cancel bank transfers after the title deed has been registered in their name. It is also intended to cut the use of cash and help tackle the informal economy.
Dr Ertugrul Dogan Erzengin, a research assistant at Marmara University’s law faculty, said the system could “definitely” prevent such schemes.
The process begins when the parties book a title deed appointment and tick the secure payment option. Both buyer and seller then receive a reference number by text message, which they use to complete the application through an intermediary institution.
Dr Erzengin said the intermediaries were generally banks. Takasbank, the state-run settlement and custody bank, works with land registry offices through an integrated system, as do state-owned and some private banks.
The reference number, generated when the sale application is made, is checked against the buyer’s and seller’s identity details at the payment stage, along with details of the property. If they match, the money is moved from the buyer’s account.
The funds are held in a blocked state by the chosen intermediary until the sale is completed and the title registered, at which point they are released to the seller.
Dr Erzengin said the system gave buyers “serious assurance” over the passage of funds and, because transactions went through banks, removed the problems specific to using cash.
