The Turkish government has introduced a central‑bank‑backed deposit scheme that can be used to satisfy the $500,000 investment requirement for its Citizenship‑by‑Investment (CBI) program. The product is designed to protect investors from the volatility of the Turkish lira while still offering a modest return.
How the scheme works
- Investment amount: US $500,000, converted into Turkish lira at the time of deposit.
- Term: 3 years, the minimum period required for a CBI applicant.
- Guarantee: The Central Bank of the Republic of Turkey (CBRT) guarantees the full principal in US dollars, regardless of lira depreciation.
- Return: A guaranteed annual return of roughly 5‑6 % in USD terms, amounting to about $85,000 over the three‑year period.
- Additional upside: If the lira strengthens against the dollar, investors may also receive interest paid in lira, potentially raising the total return to 30‑40 % per year. This lira‑based interest is not counted on as a reliable component because inflation in Turkey often exceeds 70 %.
Cost and tax advantages
- No transfer fees are charged for moving the funds into the account.
- No withholding tax (the standard 25 % on regular deposit accounts) applies to this product.
Risk profile
- The guarantee is issued by the central bank, not a commercial bank, which lowers the risk of default.
- A residual risk remains: the CBRT could theoretically exhaust its foreign‑currency reserves, though this is considered unlikely.
- The lira‑based interest component is highly uncertain due to persistent high inflation and frequent devaluation; it should be viewed as a bonus rather than a core return.
Application procedure
- Deposit the funds into the designated CBRT‑guaranteed account.
- Provide biometric data (fingerprints) for the residence permit.
- Obtain the residence permit and wait the required three‑year period.
- Receive the Turkish passport at a Turkish diplomatic mission abroad.
The entire process typically takes about one month to receive the confirmation letter, after which the remaining steps follow the standard CBI timeline.
Comparison with the real‑estate route
- Capital requirement: Both routes require a $500,000 investment.
- Complexity: The deposit option involves less paperwork and no property management responsibilities.
- Time to citizenship: Similar, as both require a three‑year holding period.
- Potential returns: Real‑estate may generate rental income or capital appreciation, while the deposit offers a fixed 5‑6 % USD return plus possible lira interest.
Investors seeking a low‑maintenance path to Turkish citizenship may find the central‑bank‑backed deposit attractive, provided they accept the modest guaranteed return and acknowledge the limited upside from lira‑based interest.
