Islamic Economics Research Center (İKAM) within the İLKE Science Culture and Education Foundation published the "Participation Finance Ecosystem Report 2025", which reveals the 2025 outlook of participation finance in Türkiye.
According to the report, 2025 was recorded as the year when participation finance transformed from a banking-centered structure into a multi-dimensional ecosystem. Savings finance companies, which provide down-payment-free, participation-based financing to those who want to own a house and a vehicle, were the fastest growing area of the year.
The total transaction volume of the sector increased by 261.8 percent to 1 trillion 211 billion liras, asset size increased by 251.1 percent to 323 billion liras, and net profit increased from 17.5 billion liras to 59 billion liras. While the number of customers increased by 117 percent to 1.15 million, the number of companies increased to 9 and the number of branches to 654.
Total assets of participation banks increased by 62.7 percent to 4.3 trillion liras, and the funds they collected increased to 2.8 trillion liras. The total net profit of the banks in question reached 85.6 billion lira. In the same period, while non-performing receivables increased by 155 percent to 42.4 billion liras, the equity growth of 41.2 percent fell behind the asset growth.
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While participation banks reduced the number of branches and ATMs, digital transaction volume increased by 41 percent to 7.9 trillion lira, and the number of transactions increased by 61 percent to 205 million. The share of individual customers in digital transaction volume increased from 27 percent to 43 percent. While approximately 1600 branches were closed throughout the sector in the last 10 years, the number of employees in participation banks increased to 22 thousand 545.
237 of the 591 companies traded on Borsa Istanbul are included in the BIST Participation All Index. BIST Participation 100 and BIST Participation 50 indices completed the year above their corresponding general indices. The number of investors in the participation index reached 4.26 million. Its share in market value remained behind its share in the number of investors.
Participation insurance grew faster than the industry
Participation insurance premium production increased by 62.9 percent to 70.15 billion lira and grew above the sector average (45.9 percent). The share in the total insurance market increased to 5.73 percent. Approximately 96 percent of production is concentrated in non-life branches.
The number of fintechs in Türkiye has increased by 40 percent since 2021, reaching 1009. On the other hand, the number of newly established fintechs decreased from 101 in 2021 to 16 in 2025. Türkiye was among the 7 largest Islamic fintech markets in the world with a market size of 8.4 billion dollars.
The sukuk issuance volume of participation banks increased by 58 percent, reaching 215.4 billion lira. While the volume has grown approximately 84 times since 2015, the Ministry of Treasury and Finance issued 34.8 tons of gold-based sukuk in 2025.
The fund amount of participants in the private pension system reached 1.81 trillion lira. 745.7 billion lira of this consists of participation-based funds. In the automatic enrollment system, 76.8 percent of the certificates have expired.
"Quantitative growth should be transformed into qualified development"
Ahmet Sait Öner, Chairman of the Board of Directors of İLKE Foundation, whose views are included in the report, stated that the participation finance ecosystem in Türkiye has undergone a significant transformation from a banking-centered structure to a multi-dimensional structure and said, "However, the real equivalent of nominal growth should be evaluated cautiously in a high inflation environment. What is really important in the coming period is to transform quantitative growth into a qualified and sustainable development." he said.
The report, which is the 30th issue of the Field Monitoring Reports series, examines participation banking, participation insurance, capital markets, public finance, digital banking, fintech, savings finance companies, lease certificates and private pension system with publicly available data.
