How Germans actually pay
Germany is the largest payment market in the euro area by volume, and its payment habits long differed from those of its neighbors. The Deutsche Bundesbank tracks them regularly in its Zahlungsverhalten in Deutschland (payment behavior in Germany) study, based on payment diaries kept by a sample of households. In 2025, for the first time since the study began, more than half of everyday payments were made without cash: 55%, up from 49% in 2023. Those 55% of transactions account for 77% of total spending by the households surveyed. Cash makes up the rest of both figures: it remains common for small amounts, but it no longer carries most of the value.
The German market splits into two worlds with distinct habits: in-store retail and remote selling. At the point of sale, the domestic debit card dominates and credit cards remain marginal. Online, cards trail PayPal, invoice payment, and direct debit. The dominant instruments differ from one channel to the other, so a payment setup built for one channel handles the other poorly.
| Payment method | In-store transactions | In-store value | Online transactions | Online value |
|---|---|---|---|---|
| Cash | 45% (−5 pts vs. 2023) | 28 % | – | – |
| Debit card (physical) | 37 % | 45% (−4 pts) | 4 % | 2 % |
| Credit card | 4 % | 6% (−3 pts) | 15 % | 19% (+4 pts) |
| Mobile payment | 13% (+7 pts) | 11% (+6 pts) | counted under online payment services | same |
| Direct debit / credit transfer | ≈ 0 % | 9 % | 30% (+2 pts) | 45% (+4 pts) |
| Online payment services (Internetbezahlverfahren: PayPal, Klarna…) | – | – | 50% (−2 pts) | 32% (−7 pts) |
What consumers carry explains this structure. 98% of respondents have at least one debit card, and 90% of account holders have a girocard; Visa Debit follows at 25% and Mastercard Debit at 10%. Credit card ownership tops out at 50%, and stated preference for credit cards fell from 13% in 2023 to 9% in 2025. Mobile payment, meanwhile, accounts for 21% of stated preferences among cashless methods.
girocard: the debit scheme that owns the point of sale
girocard is Germany's domestic debit scheme. It belongs to Die Deutsche Kreditwirtschaft (DK), the joint body of five banking industry associations: the Bundesverband deutscher Banken, the Bundesverband der Deutschen Volksbanken und Raiffeisenbanken, the Deutscher Sparkassen- und Giroverband, the Bundesverband Öffentlicher Banken Deutschlands, and the Verband deutscher Pfandbriefbanken. EURO Kartensysteme GmbH runs the scheme day to day. The girocard name dates from 2007, but the system itself goes back to electronic cash, launched in 1990. Germans still call it the “EC-Karte.”
The acceptance network is growing faster than spending. There were up to 1,344,000 active terminals in 2025, up 11.3% in a year, for about 100 million cards issued (Deutsche Kreditwirtschaft, February 2026). The growth comes from small merchants (bakeries, kiosks, market stalls) that refused cards five years ago. The average ticket is falling at the same time, an arithmetic effect of new acceptance points whose tickets sit below the existing average. The scheme is gaining smaller tickets, not new spending: transaction counts are growing faster than the amounts collected.
The girocard remains an in-person card. It offers no online payment function for merchants, and its acceptance outside Germany relied on the Maestro co-badge, which Mastercard has not issued on new cards since July 1, 2023. Banks have therefore moved their cards to Debit Mastercard or Visa Debit, with measurable effects. Visa Debit is already held by 25% of account holders and by nearly a third of 18- to 24-year-olds (Deutsche Bundesbank, 2025). At the checkout, the card looks the same to the cardholder, and the merchant processes the transaction the same way. But routing can go through the international brand, in which case the transaction leaves bilateral girocard pricing and falls under the international scheme's fee schedule.
Accepting payments in store: ELV, terminals, and acquirers
The Elektronisches Lastschriftverfahren (ELV, electronic direct debit) is an in-store payment method that turns a card presentation into a bank direct debit. It exists only in Germany, where it coexists with girocard, and international comparisons of payment methods almost always miss it. The terminal reads the card's magnetic stripe or chip to extract the IBAN, then prints a direct debit mandate that the customer signs. No authorization is requested from the issuing bank, and no PIN is entered. The merchant then collects the funds via SEPA-Lastschrift (SEPA direct debit).
- What ELV saves: the scheme fee and the girocard acquiring fee, since the transaction never touches a card network.
- What it costs: the payment guarantee. The merchant bears the full risk of returned payments and disputes, and pays the return fees.
- What it distorts: published market shares. An ELV payment starts with a card but is recorded as a direct debit, so any unadjusted German statistic understates cards and overstates direct debit.
- Its risk-managed variant: OLV (Online-Lastschriftverfahren), which checks a blacklist and scoring database before accepting, for a fee paid to the provider.
Acceptance can be measured from two sides: the payer, who can or cannot find a way to pay, and the merchant, who reports which instruments it takes. For in-person purchases, cash could be used in 94% of cases and cashless payment in 86%, five points more than in 2023 (Deutsche Bundesbank, 2025). On the merchant side, the Bundesbank found in December 2025 that 73% of businesses surveyed accepted girocard, compared with about 50% for Visa and Mastercard cards, debit and credit combined. That gap explains why a foreign cardholder carrying only an international card still gets turned away.
Kauf auf Rechnung: the No. 2 online payment method
Kauf auf Rechnung, or buying on invoice, is a payment method in which the merchant ships the goods before being paid. It plays a role in Germany unmatched in any other European market. The customer orders, receives the goods, tries them, sends back what doesn't fit, then pays the balance by bank transfer within 14 to 30 days. The mechanism amounts to mass-market trade credit, granted without any visible credit agreement, and it sits at the core of a German online retailer's operating risk.
| Payment method | 2025 | 2024 | Takeaway |
|---|---|---|---|
| PayPal | 28,7 % | 28,5 % | Stable, dominant position; no German checkout goes without it |
| Kauf auf Rechnung | 26,1 % | 25,8 % | Growing, and narrows the gap with PayPal by 0.1 point |
| Lastschrift (direct debit) | 14,4 % | 17,3 % | Down nearly three points: the line that is draining away |
| Credit and debit cards | 13,7 % | 12,3 % | Growth driven by the spread of international debit cards |
| Ratenkauf (installments) | 4,7 % | 4,3 % | Strict BNPL remains small next to plain invoice payment |
| Vorkasse (prepayment) | 3,5 % | 4,3 % | Protects the merchant, costs conversion |
| Apple Pay | 1,3 % | – | Still a small share online, but far larger than at the point of sale |
| Sofortüberweisung | 0,9 % | – | The original pay-by-bank method, now Klarna Pay Now |
Invoice setups differ first in who carries the risk of non-payment. With non-intermediated invoicing, the merchant keeps the receivable. It saves the provider's fee but absorbs defaults, reminders, and the cash tied up. With intermediated invoicing and receivable purchase, the merchant sells the collection to a specialist provider and no longer bears default risk. The leading players are Ratepay (Ratepay GmbH, 2009) and Riverty (Riverty Group GmbH, part of Bertelsmann, a brand created in 2022 from AfterPay and Arvato Financial Solutions). They are joined by Klarna (Klarna Bank AB, licensed in Sweden) and, in B2B, Billie (Billie GmbH, 2016). Riverty and Australia's Afterpay are two separate companies, and the shared name regularly causes integration errors.
Of all German payment methods, invoice payment exposes the merchant most to the return rate. In apparel, where returns are standard practice, it lets the buyer order three sizes and pay only for the one they keep. Revenue collected then drifts persistently away from revenue ordered, and reconciliation has to match three separate items: the order, the invoice issued, and the partial payment received. A system built for card payments assumes the captured amount equals the amount due, and has no way to represent a partial payment tied to a larger order.
SEPA-Lastschrift: the rail for subscriptions and recurring bills
A direct debit lets a creditor debit its debtor's account under a mandate the debtor has signed. In Germany, it carries the recurring payments of economic life: rent, energy, telecoms, insurance, association dues, and local taxes. The Deutsche Bundesbank's 2024 payment statistics credit it with 31% of non-bank transactions, down from 34% the year before, for €5.9 trillion, or 8% of total value. Credit transfers carry 90% of value, at €64 trillion. So the three instruments rank differently depending on the measure: cards lead by number of transactions, credit transfers by value, and direct debit sits in between.
pain.008 message. Applying for it is the first step in setting up recurring collections in Germany, even before signing the bank agreement. Source: Deutsche Bundesbank, Gläubiger-Identifikationsnummer service.| Criterion | SDD Core | SDD B2B |
|---|---|---|
| Eligible debtor | Any payer, including consumers | Non-consumers only |
| No-questions-asked refund | 8 weeks from the debit | None: the debit is final |
| Unauthorized transaction | 13 months to dispute | 13 months, but the debtor's bank has already checked the mandate |
| Mandate check | No check by the debtor's bank | Mandate registered and checked by the debtor's bank before execution |
| Typical use | Subscriptions, energy, telecoms, associations | B2B invoices with due dates, wholesale markets |
The Core rulebook's eight-week refund right sets the creditor's exposure to refund risk. The debtor can exercise it without giving a reason, simply by asking their bank, and the cost of the refund flows back to the creditor. That window is longer than a monthly billing cycle, so several consecutive payments remain refundable at any given time. A reserve based on the current month alone therefore covers only part of the exposure. Beyond that, a transaction the debtor claims was unauthorized can be disputed for 13 months, so you must keep the signed mandate, its date, how it was collected, and the history of pre-notifications.
Clearing has a German twist. The SEPA-Clearer of the RPS system, live since 2008, is run by the Deutsche Bundesbank itself. The central bank thus operates a retail clearing system, which is rare in Europe, where private or interbank operators usually fill that role. German banks connect directly or through EBA Clearing. This setup also explains why the Bundesbank publishes detailed, binding, and regularly revised procedural rules for processing SEPA credit transfers and direct debits.
EBICS: the bank-to-corporate channel is a standard, not a product
EBICS (Electronic Banking Internet Communication Standard) is the signed file-transfer protocol German companies use to send payment orders to their bank and retrieve their statements. It is anchored in the DFÜ-Abkommen, the data transmission agreement among the five banking associations that make up Die Deutsche Kreditwirtschaft. The standard has been mandatory for all participating banks since January 1, 2008. The old ISDN-based FTAM connection was removed from the agreement in December 2010. Connecting a corporate client to EBICS is therefore governed by an industry-wide agreement, not by each bank's own commercial offering.
- Annex 1 to the DFÜ-Abkommen: technical provisions for EBICS connections.
- Annex 2: the old FTAM connection under the Banking Communication Standard, removed in December 2010.
- Annex 3: data format specifications (payment orders,
MT940statements,camtmessages, securities messages). ERP vendors must follow this annex, which is updated periodically. - EBICS specification V 3.0.2: in effect since December 30, 2022. The rights to the specification documents belong to EBICS SCRL.
EBICS is governed across several European countries. The cooperative EBICS SCRL brings together Die Deutsche Kreditwirtschaft for Germany, the CFONB (the French banking standards body) for France, SIX for Switzerland, and PSA for Austria, and the standard is open to other countries. Version 3.0 introduced BTFs (Business Transaction Formats), which replace the old three-letter order types with a structured description of the service, scope, and format. A mapping table between BTFs and the old Auftragsarten (order types) is published and updated once a year, and the version applicable on February 27, 2026, is already available. An EBICS migration therefore means converting every order type in use with this table, because the bank server no longer recognizes an order submitted under an unconverted code. Poorly prepared migrations almost always fail on this mapping.
| Channel | What it carries | Authentication | Best for |
|---|---|---|---|
| EBICS | pain.001 and pain.008 files, camt.052/053/054 and MT940 statements | Client certificates (signature, authentication, encryption) submitted with an initialization letter | Recurring volumes, multi-bank setups, signatures split among several authorized signatories |
| PSD2 APIs (AIS/PIS) | Balance inquiries and single payment initiation | Account holder SCA, redirect to the bank | Consumer flows, aggregation, pay-by-bank; poorly suited to batch |
| Host-to-host / Swift | Bilateral bank formats or Swift messaging | Dedicated contract, Swift keys | Large multinational groups, centralized treasury outside SEPA |
From giropay to Wero: two attempts, one lesson
German banks have made two successive attempts to win back ground from PayPal in online payments. The first was built on giropay, an online bank transfer method launched in 2005, joined by paydirekt in 2015 and then Kwitt for peer-to-peer payments. The three merged under the giropay brand, run by Paydirekt GmbH on behalf of Die Deutsche Kreditwirtschaft. Together they processed 23 million transactions worth €1.6 billion in 2022, a single-digit market share. The shutdown was decided at a general meeting on June 12, 2024, and the service went offline at the end of 2024.
The second attempt is Wero, run by EPI Company, a Belgian company that brings together banks and acquirers from Germany, France, Belgium, and the Netherlands. The service runs on SEPA Instant Credit Transfer, existing transfer infrastructure, and debits the payer's checking account directly, without a settlement system of its own. Germany was the first market to launch, with peer-to-peer payments in summer 2024. E-commerce followed on November 17, 2025, with a first wave of merchants including Eventim, Decathlon, Lidl, Rossmann, CEWE, Cineplex, Zooplus, Hornbach, Veepee, and BAUR.
The gap between these figures shows how far Wero is from PayPal's position. PayPal has three quarters of accounts and 86% of payments in its category; Wero starts from 5% of accounts set up. Three things set Wero apart from the giropay generation. It runs on an instant rail that EU regulation now makes mandatory, it is built into the banking apps customers already use, and it has a merchant acquiring path through established acquirers. Each fixes one of the three causes of paydirekt's failure, but none of them guarantees consumer adoption.
BaFin, Bundesbank, Bundeskartellamt: who decides what
Payments supervision in Germany is split among three authorities with distinct powers, which determines whom to deal with on a given issue. BaFin (Bundesanstalt für Finanzdienstleistungsaufsicht, the Federal Financial Supervisory Authority) grants licenses and imposes sanctions. The Deutsche Bundesbank handles day-to-day supervision of institutions and operates infrastructure. The Bundeskartellamt polices market practices, and its intervention has had a lasting effect on card fees.
The digital euro is the Eurosystem's central bank digital currency project, which is targeting a possible first issuance in 2029, provided the EU regulation is adopted. 46% of respondents had already heard of it by the end of 2025, before any public campaign. German opinion favors greater European autonomy in payments, with 63% of respondents calling it “urgent” or “fairly necessary.” Both figures come from the Bundesbank's 2025 study. They describe a climate of opinion that Wero can draw on to drive adoption, an argument giropay never had.
Operating in Germany: what breaks and what it costs
A payment setup designed for a market where cards carry most transactions rests on assumptions that Germany disproves. Four failures follow, and they repeat from one market entry to the next. They come from design assumptions imported unchanged from another market, not from the quality of the technical integration.
- A checkout with no invoice option. A German checkout without Kauf auf Rechnung gives up a quarter of potential revenue: 26.1% of e-commerce revenue in the EHI 2026 panel. Leaving out PayPal costs about as much.
- Assuming the captured amount equals the amount due. Invoices, partial returns, and installments break that equation. The back-office system must represent one order, one invoice, and several partial payments; otherwise reconciliation becomes manual.
- A dispute reserve sized on a monthly cycle. The SDD Core refund right can be exercised without a reason for eight weeks, and an unauthorized transaction can be disputed for 13 months.
- Treating the bank channel as just another connector. EBICS is not an API: it requires certificates, a signed initialization letter, and an up-to-date BTF mapping, and it carries the distributed signature that enforces signing authority.
| Method | Channel | Who bears the risk | Main constraint |
|---|---|---|---|
| girocard | In store | The issuer (payment guaranteed after authorization) | Bilaterally negotiated fee; no open e-commerce function |
| ELV / OLV | In store | The merchant | No payment guarantee; return fees and collections are the merchant's cost |
| Intermediated Kauf auf Rechnung | Online | The provider, after buying the receivable | High fee; new credit compliance rules from November 20, 2026 |
| SEPA-Lastschrift Core | Recurring | The creditor, for 8 weeks | Gläubiger-ID required; keep mandates for at least 13 months |
| SEPA-Lastschrift B2B | Recurring, B2B | The debtor (no refund right) | Mandate must be registered with the debtor's bank before the first collection |
| Wero | Online, peer-to-peer | No recall of funds: instant transfers are irrevocable | User base still narrow; merchant coverage still being built |
| International cards | Both | The issuer, subject to dispute rules | Lower in-store acceptance than girocard; costlier than domestic debit |
camt.053 statements comes after that. Wero comes last, with no dependency on the earlier steps. It is cheap to integrate, and its usage will become measurable over the next few years.Cash keeps a role that the growth of cashless payments does not erase. It still accounts for 45% of everyday transactions and 67% of payments under €5, and 80% of the population considers it important that cash remain accepted everywhere (Deutsche Bundesbank, 2025). A store network opened in Germany without checkouts that take cash forgoes a measurable share of potential sales and exposes itself to the public debate over access to cash. Rapid digitization of payments and the persistence of cash for small amounts show up side by side in the same surveys.