Contactless debit dominates Germany as cash declines: what it means for issuers

1. The Debit Card Tipping Point

• Cash Decline: Germany, historically cash-reliant, is rapidly moving toward electronic payments. Cash's share of in-person transactions dropped to 51% in 2023 (down from 58% in 2021).
• Milestone Year: 2023 marked a major shift, as debit card expenditure volume overtook cash for the first time (32% vs. 26% of total expenditure). Cards are now the country's most widely-used payment method.
• Girocard Dominance: Germany's market-leading debit solution, Girocard, accounts for more than 80% of all card spending and recorded over 10.8 billion transactions last year.

2. Explosive Card and Contactless Growth

·        Double-Digit Growth: Card payments have seen double-digit growth across nearly all metrics over the last five years, with total card payments hitting 13 billion in 2024 (a 17.3% YoY increase).
·        Contactless is Key: The proliferation of contactless functionality is a primary driver, now accounting for over four in five (80%+) of all point-of-sale transactions.
·        Online Surge: Online card payments have risen over 20% annually, reaching 2 billion transactions, largely boosted by Girocard's 2021 integration with Apple Pay.

3. The Rising Digital Challenge

• Wallets and BNPL: Digital wallets are used in nearly one-third (28.5%) of online transactions, while Buy Now, Pay Later (BNPL) is experiencing strong growth and is projected to account for up to 10% of all retail payments by the end of 2026.
• WERO is Coming: The full introduction of the European Payments Initiative's (EPI) WERO digital wallet in late 2026 is projected to significantly impact the market. Worldline has proactively enabled online merchants in Germany to accept WERO since June 2025.

4. Implications and the Worldline Advantage for Issuers

• Innovate in Debit: These trends signal that card issuers must prioritize innovation in their debit card products, which are the fastest-growing payment method in Germany.
• Mitigate Competition and Fraud: Issuers must be aware of competition from non-bank entities and prepare for increased pressure to introduce digital ID solutions due to fast-rising fraud attempts.
• Worldline's Role: Worldline acts as a partner to help banks and fintechs maintain leadership by offering an end-to-end platform across the entire card value chain—from issuing and card management to processing and fraud protection.
• Comprehensive Services: Worldline's issuing services cover prepaid, debit, credit, commercial, and virtual cards, alongside next-level fraud protection features like card tokenization, 3DS security, and full SCA compliance. Value-added services such as BNPL capabilities and a rich API catalogue, enabling rapid product deployment, are also part of the solution.

Read the full article: https://www.paymentscardsandmobile.com/contactless-debit-dominates-germany-as-cash-declines/