Why is mobile payment not growing up in Germany

Today we’re going to talk about why mobile payment is not growing up in Germany?

Earlier, a female author of the signature Millian used the shocking headline in the German newspaper Monde: China’s mobile payments dumped Germany for a few light years and gave the Germans an Enlightenment course paid by mobile payment.




At a conference Ms. Millian saw attendees from China, using mobile phones to pay for it. In the eyes of Germans, WeChat payment, Alipay and various services are colorful and dazzling. Compared with Google or Amazon, which are used by Germans, Chinese mobile phone apps are quite different in appearance and aesthetics.

In addition, according to media reports, Apple pay has been opening services in Germany for several months, but there are not many people to take out the Apple phone “drop” checkout, the German media on this “new thing” prospects are not very good. Germans clearly prefer to hold “real gold and silver”–cash compared to paying with their mobile phones.

In Germany, which has always been at the forefront of the world in science and technology, why is it so  “lagging ” in the field of mobile payments? That’s because 77% of Germans prefer to pay in cash because they feel more secure using it.

Germany generates about 20 billion retail deals a year, 3/4 of which are paid in cash, according to a recent report by the German Federal bank. In German wallets, there is an average of 103 Euros in cash, and France has only 32 Euros. Even the most commonplace CARDS are held in Germany at 36%, compared with 62% in America. For many Germans, credit card consumption usually refers to debit cards, and is often used for large consumption, after all, ATMs have a limit on the amount of cash withdrawn.

The report also points out that cash is the quickest means of payment in retail transactions in Germany, averaging about 22 seconds, about 7 seconds faster than using a bank card with a password, and about 16 seconds faster than using a personal signature bank card.

It may be good for Germans to earn money quickly, but fast payment is not necessarily a good thing.

Cultural traditions and privacy concerns are usually an explanation of the two dimensions in which Germans prefer cash. However, this does not fully explain why mobile payment is not growing up in Germany。




In fact, some people in Germany are embracing new payment technologies. About 13% to 18% of germans use mobile payment on a daily basis. Some local high-tech payment companies have even been founded in the last century, but have never grown. And because of this, the influence of each mobile payment brand is relatively small for the Germans.

Whether in supermarkets or restaurants, Germany remains stuck with cash and credit CARDS. In a 2016 survey, only one in four Germans had ever scanned a QR code, and less than 10 percent of respondents said they often or sometimes used them.

The reason for this phenomenon is very simple. There is no APP for payment in Germany, and German Banks do not support mobile payment for the time being.

On the technical side, there is a lack of social platforms in everyday life in Germany that blend mobile payments as much as China does. A unified information technology network has not been built across Germany to support mobile payments.



Apple Pay, for example, has just entered the German market. On its app page, only nine German Banks support this function, including some unknown commercial Banks. In Germany, there are more than 1,800 Banks.

In the financial sector, traditional Banks and technology companies complement each other. What worries Germany’s banking sector, however, is that profits are squeezed by tech companies and the market is nibbled away by tech companies. In other words, German Banks are now the source of their own profits, whether cash or cashless.

Unlike mobile payments, cashless payments are nothing new. Credit CARDS, introduced more than half a century ago, have solved this problem. The Nordic countries ‘ widely acclaimed cashless society is also based on the credit card system.

But mobile payments are another story. From the point of view of bank interests, the construction of a new clearing system for mobile payment technology may not only be unprofitable for a considerable period of time, but will even produce competitors to replace credit cards, And that’s exactly what banks can’t afford. In this context, the traditional banking industry can not give mobile payment suitable soil, and even the impulse to stifle it in the cradle. Even collaboration limits it to the traditional model.

Today in Germany, whether Apple pays or PayPal, features are severely limited and simply cannot relate to the bank’s core business. The big German banks will not yet shift the power in their hands to mobile payment services.

In the final analysis, the European and American banking sector, with its main goal of profitability, does not welcome any “foreign spoilers”. In the absence of a huge change in business picture and consumption habits, it is difficult for European and American banks to be motivated to reverse people’s payment preferences.

Forcing Germans to give up mobile payments due to security and privacy concerns




There are three levels of concern that most Germans give up mobile payments based on security factors:

1. Fear of being cheated. Due to a lack of understanding of mobile payment technology, worry about payment errors, accidentally pay more or pay other businesses, the money does not come back. Or afraid of being stolen by others, think it is still the most safe to use cash.
2. It is a fear of personal data breaches. In Germany, citizens ‘ data are strictly protected, and everyone is focused on protecting privacy.
3. Merchants are afraid to accidentally divulge customer data to bring disaster to themselves. Based on the implementation of GPDR law, many businesses worry that once the data is intentionally or unintentionally compromised, it will be a disaster for merchants.

But it is only a matter of time before mobile payments are accepted by Germans as a new phenomenon. A growing number of Germans are trying cashless payments, with about a third of German consumers using digital payments at least once.

To date, 10,000 retailers in Europe have introduced Alipay, more than 2000 of them in Germany and the main merchants are the Rossmann supermarket chain. At the same time, Germany’s large department store chain Breuninger announced the full opening of Alipay and WeChat payment. According to media reports, this is the first department store in Germany to introduce both Alipay and WeChat payment.

Part of this article cited:huanqiu.com