Almost nowhere else does cash play such an important role as in Germany. Banknotes and coins still dominate the payment behavior of Germans. However, the share of cash in overall payment methods is also falling in the country. And the first German retail chain phased out cash payments this week.
While in present day Sweden you won’t get far with banknotes and coins when shopping, Germany is still a bastion of cash. According to Deutsche Bundesbank, no other means of payment is used more frequently in Germany. The most recent Bundesbank survey on payment behavior in Germany showed that in 2021 respondents completed a total of 58 percent of their payments for the purchase of goods and services with cash. However, in the last survey before that, conducted in 2017, it was still 74 percent. From that perspective, there are clear signs that cash is also on the decline in Germany. Another such sign was reported this week by “Der Spiegel”.
Gravis no longer accepts cash payments
Accordingly, the German electronics retail chain Gravis stopped accepting cash payments this Monday, January 13. When asked by the news magazine, the company, which works closely with the US tech group Apple, confirmed that the regulation applies to all 40 branches nationwide, without exception. Even trivial amounts could no longer be settled in cash.
As for the motives, Gravis told “Spiegel” that the proportion of cash payments in the German branches had been very low for around two years, most recently it was a “small single-digit percentage.” In other words, well over 90 percent of all Gravis customers in Germany had already paid cashless. Now it’s 100 percent.
Cashless: “simple, safe, fast”
However, when taking this step, Gravis is not just following the dominant payment behavior of its customers: “For us as retailers, cashless payment is cheaper, easier and it enables faster processes,” the company said, adding that cashless payments were also “simple, safe, fast” for customers, and helped to prices for longer.
In a press release by Gravis published after the “Spiegel” report, the company also stated that the new branch concept “no longer provides for a checkout counter in the conventional sense”. Instead, Gravis plans so-called mobile terminals, which can be flexibly adapted to the customer journey in the store, enabling customers to pay conveniently. No longer will there be any traditional tills, nor will there be any paper receipts, Gravis said.
Bundesbank board member: e-wallets on the up
It is not surprising that such a development is more likely to take place in a retail chain that sells smartphones, tablets and other online devices than in the supermarket around the corner or in the repair shop. Wherever devices are sold with which one can make cashless and online payments, bills and coins lose their meaning more quickly. However, it is to be expected that this will also happen in other retail sectors in Germany – a development that the Bundesbank survey mentioned also indicates.
Accordingly, in 2021, 17 percent of the smartphone owners surveyed were already paying with their smartphone at the checkout in shops. In the case of people wearing smartwatches or fitness bracelets with a payment function, the proportion was even 27 percent. When the study was published last year, Burkhard Balz, the Deutsche Bundesbank board member responsible for payment transactions and settlement systems, said: “I expect that more and more people in Germany will exchange their physical wallets for electronic wallets in the future.”