Germans love cash – that’s why the card has a hard time

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The critical love of Germans is unwavering – that’s why the card goes through hard times

Neither digitization nor a pandemic can replace money Neither digitization nor a pandemic can replace money

Neither digitization nor a pandemic can replace money

Source: pa / Ulrich Baumgarten

Germans still prefer to pay in cash. This is despite the fact that retailers have been demanding card payments due to the coronavirus pandemic. The fact that there are fewer and fewer ATMs does not change that. Many have always been getting their tickets elsewhere.

sSome of them are still hung in supermarkets today: small banners with a request for cashless payment if possible. For health reasons, many retailers wanted to ban banknotes and coins from their plows at the height of the Corona pandemic.

However, this cannot break the Germans’ love of cash, as the current study by the Bundesbank on payment behavior shows. According to this, consumers made a total of 58 percent of their payment transactions with banknotes and coins last year. The percentage is down compared to the last major survey in 2017. At the time it was still 74 percent. The decline in the use of cash is mainly due to the growth of online purchases during the Corona crisis, the Bundesbank explains.

Source: Infographic World

“Neither digitization nor the pandemic has been able to replace cash,” says Johannes Bermann, the Bundesbank’s board member responsible for cash. “When it comes to making payments, cash is still the most popular in Germany.” This is likely to remain the case: the vast majority of those surveyed (69 percent) said they would continue to pay with coins in the future.

According to the survey, they valued privacy protections above all else, emphasized a good outlook for spending – and considered coins and banknotes to be particularly reliable. The recent turmoil in retail card readers has proven them right. Since May 24, thousands of devices from the US company Verifone have failed. Therefore, for several days, consumers were unable to use the card to pay for their purchases in many supermarket chains and pharmacies.

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Perhaps that is why so few consumers rely exclusively on plastic in their wallets. On average, individuals carried around 100 euros with them last year – nearly four years (103 euros). The fact that more and more bank branches are closing is unlikely to change that. Because when it comes to providing cash, the retail business itself is playing an increasing role. At the moment, you can not only pay for your purchases with the card, but also withdraw cash at the same time.

According to a recent survey by the EHI Retail Institute, nearly nine out of ten supermarkets and pharmacies offer this service. And consumers seem to be benefiting increasingly from this. Generally, companies pay approximately ten percent of their total cash sales to their customers in this way. This percentage has increased significantly during the Corona pandemic period. In 2019 it was still 2.8 per cent.

Source: Infographic World

But you only get cash if you buy something. In most cases, withdrawals are associated with minimum amounts between five and 20 euros. A necessary evil for the customer, as some merchants can achieve higher sales. However, the industry is not satisfied. After all, companies have to pay a fee to the banking sector on the amount paid – on average, it’s 0.13 percent of the amount withdrawn. Retailers consider this compensation unjustified. Because the service also eases the credit industry. “This gives them the opportunity to incrementally break up ATMs and cut costs,” says EHI.

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However, cash lovers should not write off the card. According to the Bundesbank, 17 percent of those surveyed said they had discovered other means of payment primarily due to the coronavirus pandemic. Phone and contactless payments often make it easier to shop. After all, small payments can now be made without entering the PIN or simply by showing the smartphone. For the study, the Bundesbank surveyed a total of more than 5,800 adults between September and December 2021.

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To view embedded content, your revocable consent to the transfer and processing of personal data is required, since such consent is required by embedded content providers as third-party providers [In diesem Zusammenhang können auch Nutzungsprofile (u.a. auf Basis von Cookie-IDs) gebildet und angereichert werden, auch außerhalb des EWR]. By setting the switch to “On”, you agree to this (which can be revoked at any time). This also includes your consent to the transfer of certain personal data to third countries, including the United States of America, in accordance with Article 49(1)(a) of the General Data Protection Regulation (GDPR). You can find more information about this. You can withdraw your consent at any time via the toggle and via Privacy at the bottom of the page.

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