German Consumer Payment Habits Shift Away From Cash, Study Finds

German consumers are increasingly abandoning cash in favor of digital payment methods, according to a new study by S-Payment GmbH released in April 2023. The report, titled 'Consumer Payment Behavior 2023,' highlights a fundamental shift in how Germans prefer to pay for goods and services.

While cash remains the most frequently, albeit occasionally, used payment method at the point-of-sale (PoS), its significance is diminishing, particularly among younger demographics. This trend is attributed to the rise of card payments and mobile payment solutions. The study, conducted by Delphi Research, surveyed 1,512 German consumers aged 16 to 75.

Mobile payment options like Google Pay and Apple Pay, though still having a minor role in online transactions, show high usage intensity among their users. For online purchases, PayPal emerges as the most popular method, scoring well across various benefit profiles. Key criteria for choosing a payment method, both at PoS and online, include reliability, acceptance, simplicity, security, and expense control. Buyer protection is also a significant factor for online payments.

The research indicates a notable gap between interest in mobile payments and actual usage, with the primary barrier being a lack of impulse to try it for the first time. Users cite speed and the constant availability of smartphones as major advantages. Concerns about technological dependence, data privacy, and less control over spending compared to cash are identified as drawbacks.

Regarding online shopping behavior, Generation Y shows the highest average spending, followed by Generation X. While younger generations predominantly use smartphones for online purchases, older generations still prefer using computers. There is considerable interest in a unified app for both online and PoS payments, particularly if it offers robust buyer protection, security, and expense management features.