TEFAS at Ten: How Turkey's Fund Supermarket Became the Unlikely Success Story of Turkish Capital Markets

In the winter of 2013, if you wanted to buy a mutual fund in Turkey, you went to your bank. Not to a brokerage, not to a website, not to an app, to a physical bank branch, where a relationship manager would present you with a menu of funds managed by that bank's own asset management subsidiary and precisely no one else. If you banked with Garanti, you bought Garanti Portfoy funds. If you banked with Is Bankasi, you bought Is Portfoy funds. The idea that you might compare management fees across providers, or switch your money from one fund family to another without closing an account and opening a new one at a different bank, was not merely impractical; it was structurally impossible. The banks controlled distribution, and distribution controlled everything. This was the landscape that Takasbank's Turkiye Elektronik Fon Alis Satim Platformu, TEFAS, was designed to break apart. A decade later, the verdict is clear: it worked. Not perfectly, not completely, but substantially and irreversibly. TEFAS is one of the genuinely good things that has happened to Turkish capital markets, and on its tenth anniversary, it is worth pausing to understand why.

The platform launched in January 2014 with 180 funds from 28 asset management companies. The premise was elegant in its simplicity: any investor could buy any fund listed on TEFAS through any participating distributor, regardless of which firm managed the fund. A Garanti customer could buy an Is Portfoy fund. An Akbank customer could access a boutique firm's equity strategy. The platform handled settlement, reporting, and unit price publication centrally. For the first time, Turkish fund investors could see every fund in the market on a single screen, compare performance and fees, and switch between them with a few clicks. The effect on the industry was seismic.

The numbers tell the story with satisfying clarity. At launch, TEFAS listed 180 funds with combined assets under management of approximately 34 billion TL. By 2018, the platform hosted over 400 funds and AUM had nearly tripled. The inflection point came during the high-inflation, high-interest-rate environment of 2022-2023, when Turkish retail investors flooded into money market and short-term bond funds as alternatives to bank deposits. By the end of 2023, TEFAS listed over 900 funds from 65 asset management companies, with total platform AUM exceeding 800 billion TL and more than 7 million individual investor accounts. The compound annual growth rate of AUM on TEFAS over its first decade is approximately 37%, a figure that reflects both genuine platform adoption and the nominal effects of inflation, but is striking by any measure.

What TEFAS got right, and what its architects at Takasbank and the SPK deserve genuine credit for, was understanding that the fundamental problem with Turkish fund distribution was not technology but incentives. Before TEFAS, banks had no reason to offer competitors' funds; it would cannibalise their own asset management revenue. TEFAS did not eliminate this incentive problem, but it created an alternative channel that bypassed it entirely. The platform's transparent fee disclosure was equally important. For the first time, Turkish investors could see, in standardised format, exactly what each fund charged. The effect on pricing was predictable and salutary: management fees came under visible competitive pressure for the first time, particularly in the money market and short-term bond fund categories where performance differences are minimal and fees are the primary differentiator. Average management fees for money market funds on TEFAS have fallen by roughly 40 basis points over the decade. That is real money returned to real investors, and it happened because of a platform that made opacity impossible.

The unfinished business is real, however, and pretending otherwise would be a disservice to a platform that deserves honest engagement rather than uncritical celebration. ETF distribution on TEFAS remains primitive. Exchange-traded funds, the fastest-growing fund category globally and the vehicle that has driven the most dramatic fee compression in developed markets, are still awkwardly grafted onto a platform designed for open-end mutual funds. TEFAS lacks a proper fee comparison tool, something that the UK's Hargreaves Lansdown and Australia's BT Panorama have offered for years. The platform's user interface, while functional, has not meaningfully evolved since its early years. Most importantly, TEFAS has not yet meaningfully addressed the quality problem: the platform lists over 900 funds, a significant proportion of which are near-identical money market products differentiated by nothing except their management company's name. A platform that democratises access to mediocrity is only half the revolution. TEFAS needs curation, comparative analytics, and a willingness to help investors distinguish between the genuinely good and the merely available. Ten years in, the foundation is solid. The building is far from finished. But anyone who remembers the paper forms and the captive distribution of 2013 will recognise that what Takasbank built is something Turkey's capital markets can be proud of, a rare sentence in this publication, and one we do not write lightly.