Did You Know That Germans Prefer Cash Over Credit Cards?
Yep. That’s true. According to this research by Boston Fed nearly 80 % percent of all transactions in Germany are done by cash. In the era of contactless payment like Google Wallet or Apple Pay that figure is quite… staggering. On the contrary, Americans make only 46 % of all purchases using cash.
So, how come Germans are not jumping on the plastic card bandwagon?
Although it is hard to pinpoint one particular reason we can think of the following:
- Privacy concerns. Since credit card transactions are recorded, cash gives the feeling of anonymity. And Germans tend to be sensitive about their data privacy. Case in point: Germany ordered Facebook to stop collecting data on WhatsApp users.
- Limited payment options. According to the research by Deutsche Bundesbank many retailers simply don’t support cashless payments. Heck, even IKEA is hesitant to accept them.
- Thirdly, Germans are quite conservative. So when the government hinted that it wants to ban cash transactions over €5,000, nearly 74% of population said they would oppose such law,
- Last but not the least, such favoritism towards cash can be explained by previous economic turmoil, namely hyperinflation of 1923.
This phenomena can actually be very challenging for companies that rely on modern payment methods. For example, Uber. Since it allows only cashless payments some customers were discouraged from ordering a ride.
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