The Continued Rise of Card Payments in German Retail
A recent study by the Cologne-based EHI Retail Institute reveals the ongoing shift away from cash in the German retail sector. In 2024, card payments accounted for approximately 63.5% of the total retail turnover, which amounted to a staggering 495 billion euros. This marks a significant increase of 1.7 percentage points compared to the previous year, indicating a clear and sustained trend. The study, which was made available to the German Press Agency, provides valuable insights into the evolving payment preferences of German consumers.
The corresponding decline in cash usage is equally noteworthy. The share of cash payments in retail transactions dropped to 33.8%, reflecting a considerable decrease from pre-pandemic levels. Other payment methods, including financing and invoice purchases, as well as gift vouchers, accounted for the remaining portion of the retail turnover. To put this shift into perspective, in 2019, before the onset of the COVID-19 pandemic, cash payments represented over 46% of all retail transactions. This comparison underscores the profound impact that the pandemic has had on accelerating the adoption of cashless payment methods.
Despite the growing dominance of card payments in terms of turnover, cash remains the most popular payment method based on the sheer number of transactions. According to Horst Rüter, the author of the EHI study, cash was still used in more than half of the approximately 20 billion transactions that took place in 2024, accounting for 54.6% of the total. This suggests that while consumers are increasingly opting for card payments for larger purchases, they still prefer to use cash for smaller, everyday transactions. This preference could be attributed to factors such as habit, perceived ease of use, and concerns about data privacy.
The study also highlights the significant impact of the COVID-19 pandemic on retail shopping habits. During the pandemic, the number of purchases made in physical retail stores in Germany plummeted to as low as 16.6 billion. However, in 2024, the number of transactions has rebounded to pre-pandemic levels, indicating a recovery in consumer confidence and a return to in-person shopping. Notably, card payments were used in over 44% of these purchases, demonstrating a substantial increase in the adoption of cashless payment methods. Over the past five years, the share of card payments has doubled, further emphasizing the rapid pace of this transformation. The Girocard remains the market leader in the realm of card payments, solidifying its position as the preferred method for cashless transactions among German consumers.
The EHI study also reveals the increasing popularity of mobile payment methods, such as smartphones and smartwatches. More than one-eighth (12.9%) of all card-based payment transactions are now processed via mobile payment platforms like Apple Pay or Google Pay. This represents a significant increase from 7.5% in 2023, indicating a growing acceptance and adoption of these technologies among consumers. The convenience and speed offered by mobile payment methods are likely driving this trend, as consumers increasingly seek seamless and contactless payment experiences. The rise of mobile payments also reflects the growing prevalence of smartphones and smartwatches in everyday life, as well as the increasing integration of these devices into the retail ecosystem.
Interestingly, the study also indicates a rise in the use of cash withdrawals while shopping. The total volume of cash withdrawals increased by a considerable 10% year-on-year, reaching 13.57 billion euros. This seemingly contradictory trend may be explained by several factors. Consumers may be using cash withdrawals as a means of managing their finances, avoiding ATM fees, or simply preferring to have cash on hand for smaller purchases or in situations where card payments are not accepted. Additionally, the availability of cash withdrawal services in retail stores provides added convenience for consumers, making it easier for them to access cash when needed.
The EHI study is based on data collected from 499 companies, representing approximately 100,000 businesses across 35 different sectors. The total gross turnover of these companies amounts to 314.8 billion euros, providing a comprehensive and representative snapshot of the German retail landscape. The findings of the study offer valuable insights for retailers, payment providers, and policymakers, helping them to understand the evolving payment preferences of German consumers and to adapt their strategies accordingly. The continued rise of card payments and the increasing adoption of mobile payment methods underscore the importance of investing in modern payment infrastructure and providing consumers with a diverse range of payment options. As the German retail sector continues to evolve, it will be crucial to monitor these trends and to adapt to the changing needs and preferences of consumers.
