In this ever-evolving and technologically savvy world, it becomes harder and harder to stay true to traditional methods of payment. However, Germany is a slight exception in that cash is still considered king and often preferred in most cases.
It is not uncommon to see retail stores only accepting plastic for transactions above a certain amount in Germany. Interestingly enough, only 9% of Germany’s online payments are handled by credit and debit cards (MasterCard, Visa and AmEx). As one of the top 5 B2C ecommerce markets, Germany stands out for their payment ways.
Although cash is still considered king and the most widely accepted method of payment, there are obviously many other options available including banks, e-wallets, prepaid cards, and mobile payments (DCB). Let’s dive into a quick overview of each method:
Because of the prominence of cash as the preferred method of payment for smaller purchases, ATM’s are widespread and easily accessible wherever you are. Whether at the bank or in a local city center, ATM’s are but a few steps away. This may sound great and convenient however, there are small fee’s along the way that make the average user shy away from withdrawing too many times from an ATM. Sofort überweisung.de is a payment method that uses online bank transfers and merchants provide their customers with a seemless way to pay through online banking using TAN. SafetyPay is method of payment through global online-banking that lets customers use their service to make online purchases worldwide using their local bank account and currency. GiroPay is another popular online bank transfer method designed to optimize payments for e commerce. In 2013, SafetyPay and Giropay agreed to form a partnership to provide security of online payments in Germany.
The most popular e-wallet in Germany is Paypal, much like in the United States. Skrill is also a popular e-wallet or also called a digital wallet, which lets you pay safely with your bank account, debit or credit cards or send money internationally. E-wallets in general account for less than 10% of alternative payment transactions in Germany.
Paysafecard is a great example of a pre-pay system used for online transactions. Bank account information and credit card details are not necessary when paying with the paysafecard which makes it attractive and convenient. People in Germany state that using the paysafecard is comparable to paying with cash. For small transactions such as subway tickets and purchasing in-game items, prepaid cards are quite useful but are not the most popular method of payment in Germany.
Mobile Payments (DCB)
Mobile payments are widespread in Germany much like the rest of the world and are the primary source for in-game application purchases. Services such as Mopay offer payment solutions for in-game transactions online and allows the merchant to bill charges directly to the consumer’s mobile phone. Mopay is also unique in that a whole segment of untouched consumers are accessible; those that do not have access to credit cards or bank accounts.
A Final Look
In order to increase conversion and transactions within Germany, you have to maintain the mindset that the Germans have a strong-holding tradition of paying by cash, bank transfers, and debit cards through alternative payment methods. Germany represents the second largest gaming market, only behind the United Kingdom, and the way to penetrate this large-scale gamer-base is through online banking, mobile payments, prepaid cards, and e-wallets.