Germany’s Moderate Approach to Digital Payments.
Germany had an estimated population of 83,783,942 as of the middle of 2020, according to UN data. Based on Worldometer elaboration of the latest UN data, the country had a population of 83,922,229, with 76.3 percent living in urban areas, mostly in Berlin, Hamburg, and Munich. The median age of the population was 45.7 years. Germany's online population grew to 77.7 million by the end of 2019 from 74.1 million in 2018, according to the PPRO WECE Report.
The high levels of internet and smartphone penetration make Germany the third-largest e-commerce market in Europe. According to JPMorgan, the excellent delivery logistics and confidence among citizens to shop online are key features of German e-commerce as the nation is known to be home to discerning shoppers who have the highest product return rate in Europe. The average annual revenue per paying user rose to $1,824 by the end of 2020 from $1,650.41 in 2019, according to the PPRO WECE Report. Emarketer reported that German retail e-commerce sales rose to $92.33 billion (€82.46 billion) in 2020 from $79.47 billion (€70.97 billion) in 2019. Most cross-border e-commerce purchases by German shoppers are of products from China, the UK, and the US.
Most German shoppers prefer to pay with bank transfers (52 percent), followed by e-wallets, cards, cash, and other payment methods. For cashless payments, the big players are Girocard, Sofort, SEPA direct debit, PayPal, Giropay, RatePay, Visa and Mastercard, while new players include Apple Pay and Google Pay. According to JPMorgan, German e-commerce payments are dominated by the domestic brand Girocard, which is co-branded with Maestro, VPay, or JCB to enable international acceptance.
According to the IMF data, Germany had a gross domestic product of $3.86 trillion in 2019, which declined by 6% to $3.78 trillion in 2020 due to the pandemic As the economy continues to recover, the GDP is expected to expand by 4.2 percent to about $4.32 trillion in 2021.
Internet & mobile phone trends
According to Statista, more than 90 percent of the population aged 14-59 have internet access, while only 52 percent of those aged 70 years and older go online regularly. According to Datareportal, there were 77.79 million internet users in January 2020, having increased by 307,000 (+0.4 percent) since 2019. Internet penetration in Germany stood at 93 percent in January 2020, according to the same source. Meanwhile, smartphone penetration rose to 79 percent by the end of 2019 from 69 percent in 2018, according to the PPRO WECE Report.
According to data compiled by learnbonds.com, Germany had the highest banked population in Europe in 2019 when 69.67 million people had bank accounts, while the banking rate stood at 83.74 percent based on the country’s population. Meanwhile, only 53% of the population had debit or credit cards.