Are Cracks Appearing in Germany's Preference for Cash? - eMarketer
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Are Cracks Appearing in Germany's Preference for Cash?

Consumers are increasingly turning to other payment methods for larger purchases

October 10, 2017 | Retail & Ecommerce

Are consumers in Germany finally turning away from cash as their favored way to pay for purchases?

According to an August survey of internet users in the country by Kantar TNS for Bundesverband Digitale Wirtschaft (BVDW), that might be the case. The poll found two-thirds of respondents preferred to use electronic cash or credit cards for purchases of €50 ($55) or greater. Almost half said the same about purchases between €25 ($28) and €50 in value.

Internet Users in Germany Who Prefer to Use Cash vs. Card Payment Methods*, by Amount Spent, Aug 2017 (% of respondents)

For smaller purchases, respondents overwhelmingly favored cash. But overall, the study found just 30% of respondents refused to use noncash payment methods. Respondents cited a perceived inability to control expenses, security concerns and worries about data protection as some of the reasons they stayed away from payment methods other than cash.

Those who did use cashless payments cited flexibility, comfort, speed and greater safety for larger transactions as the main benefits of doing so.

When it comes to ecommerce, however, bank cards still appear to be an afterthought.

An April 2017 report by EHI Retail Institute noted that post-delivery invoices were used for 30.5% of B2C ecommerce sales in Germany in 2016, making it the most common payment method. A similar study by Kantar TNS for delivery firm DPDGroup in October of last year found an even greater preference for invoicing, which was used for 51% of digital purchases in the country.

Electronic payment methods were not completely ignored, however. EHI’s study found that about one-fifth of B2C ecommerce sales were paid for using direct debit, with another 18% of sales completed via PayPal.

A Q1 2017 survey by PwC of smartphone owners in Germany offered some optimism about the adoption of other payment methods.

Only 17% of respondents currently made mobile payments. But 42% of the sample said they would like to use them in the future.

—Cliff Annicelli

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