The trend towards cashless payments has become increasingly prevalent in Germany in recent years. Credit cards, online banking and mobile payment methods such as Apple Pay or Google Wallet are being used by more and more consumers to pay for their purchases.

The topic of abolishing the EC card in German retail chains has been the subject of much discussion in recent weeks alone. As the news magazine "Spiegel" reported just a few days ago, the German technology retail chain Gravis, which has close ties to Apple, is abolishing cash payments. According to the report, the measure applies to all 40 branches nationwide. The amount of the purchase is not the deciding factor. But what are the reasons for this trend? And how will it develop in the future?

Is cashless payment really the future? Advantages and disadvantages at a glance

First of all, there are many advantages to making cashless payments.

  1. Security:
    One of the most important advantages of cashless payment is increased security. The risk of cash being lost or stolen is minimized as there is no longer any physical currency. Lost cards can be blocked quickly and there are options such as two-factor authentication to prevent fraud.

  2. Convenience:
    Cashless payments make the purchasing process quicker and easier. Customers don't have to search for suitable change or carry around large amounts of cash. Most cashless payment systems can be used with a single click or by scanning a QR code.

  3. Accuracy:
    Cashless payments minimize human error that can occur when handling cash. Amounts are calculated accurately and there is no need for the vendor to count or hand out cash.

  4. Traceability:
    Another important feature of cashless transactions is that they are usually fully traceable. Every transaction is recorded and can be easily verified if necessary.

  5. Rewards and discounts:
    Many cashless payment systems offer rewards or discounts for customers who use this option. For example, customers can collect points that can later be exchanged for products or services.

  6. International use:
    Cashless payments can be used worldwide. This makes them a convenient and flexible option for travelers who don't have to juggle different currencies.

  7. Hygiene:
    In times of pandemics or when infections are transmitted, cashless payments are more hygienic and safer than using cash. Studies have shown that the virus can survive and be transmitted on paper money.

  8. Environmentally friendly:
    Cashless payment is also more environmentally friendly than printing, transporting and disposing of paper money. It reduces the need for physical money and thus lowers the amount of energy and resources required to produce and transport paper money.

However, the trend towards cashless payments can also be criticized.

The trend towards cashless payment can also be criticized. There are fears that customers' privacy and data will be compromised by the increasing digitalization and networking of society. There are also fears of a loss of freedom and independence due to the disappearance of cash.

Cashless payment methods are based on electronic systems that are susceptible to technical errors and failures. If the technology fails, this can lead to long waiting times at the checkout and delays in payment. Even though such failures are rare, they can be frustrating and annoying for consumers and merchants alike.

In addition, not all consumers have access to the technology required for cashless payments. Older people or those on low incomes may not be able to afford expensive smartphones or credit cards, or may be unfamiliar with the technology. If cashless payments become the only option, these consumer groups may be excluded.

The future of the Girocard: upgrading for digital use

The German banking industry has announced a further upgrade of the Girocard to make it more attractive for digital use and use in online retail. Functions such as payment within smartphone apps, linking to bonus programs or integration into wallets are planned. These new developments focus in particular on contactless payment by card and the digital girocard in the smartphone or smartwatch.

Contactless payments can already be made with debit and credit cards equipped with an NFC chip. Services such as Apple Pay and Google Pay or banking apps also enable contactless money transfers using a smartphone or smartwatch. Payment data is exchanged in encrypted form with the terminal at the checkout when customers hold their card, smartphone or smartwatch close to the device.

The majority of the 100 million or so Girocards issued by banks and savings banks in Germany are already equipped with the contactless function. According to industry estimates, fast payment in passing is now possible at 95% of the more than one million terminals in the retail sector.

The Girocard will therefore continue to gain in importance and will also play an important role in the digital age. The new functions will make cashless and contactless payments easier, more convenient and more secure for customers. We can look forward to seeing what other developments the future will bring.

Do you have any further questions about cashless payment? Give us a call or send us an e-mail.
We will be happy to advise you personally!

Your Smartstore team

Email: info@smartstore.com
Phone: +49 (0)231-5335-0
SmartStore AG
Kaiserstrasse 63-65
44135 Dortmund