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German Market - What's the breakdown of Online Card Payments? I would like to know the percentage of people who pay for their purchases completely upfront VS those who pay in installments VS those who pay on invoicing VS those who pay on finance plans VS any other types of payment.
In Germany, 30.5% of people who shop online pay by using Invoice, followed by 20.2% who pay with debit cards. 12.2% of pay using credit cards. Additionally, SEPA direct debit represents 35% of online payments, VISA accounts for 14% of online payments, followed by MasterCard with 9%.
OVERVIEW
There are two limitations to this research. First, break down of payment cards is not available by brands or payment processors (i.e payment using Credit cards consists of X% of Visa and Y% of MasterCard). The statistics that are available are combined statistics (.i.e 14% of payments is done/processed by Visa). Secondly, we could not find any relevant information percentage of those who pay using a finance plan. We searched extensively for this particular data but most results gives percentage for other sectors that are far from the online retail space (i.e car financing, house financing).
PAYMENT METHODS
According to a survey done by Statista in 2016, this is the usage of selected payment methods in German online retail:
"Invoice — 30.5%
Direct Debit — 20.2%
PayPal — 17.9%
Credit Card — 12.2%
Installment purchase — 4.5%
Advance Payment — 4%
Payment on collection — 3.6%
Instant transfer — 2%
Cash on delivery — 1.9%
Amazon Payments — 1.1%
Giro Pay — 2.1%"
If we interpret these results, it becomes clear that 59.5% of people pay completely upfront (all payment methods excluding Invoice, purchase in installments, payment on collection and cash on delivery).
Additionally, another survey looks at payment methods that are considered to be the most important by consumers. According to a study from BITKOM, "63% consider invoice to be the most important payment method in Germany, followed by online payment services such as PayPal (56%), debit (46%), credit card (29%), immediate transfer (26%), payment in advance (24%), cash on delivery (9%)".
PAYMENT CARDS BY TYPES
European Central Bank puts out reports that show data for the total number of payment cards by types in Germany. This report isn't just for online retail, but could help in establishing the most popular choices regarding payment cards. We further found this numbers as a percentage of the total German population for better presentation. The total German population in September 2017 amounts to 82,491,000 people.
Total number of cards in circulation = 154,269,000 (187% of Germans)
Cards with a debit function = 108,619,000 (131.7%)
Cards with a delayed debit function = 27,991,000 (33.9%)
Cards with a credit function = 5,682,000 (5.2%)
Cards with an e-money function = 86,114,000 (104.4%)
ONLINE PURCHASES ON INTERNATIONAL WEBSITES
Germans are considered to be "one of the most open shoppers in the world when it comes to cross-border e-commerce, with over 50% of online retail purchases taking place on an international website". When shopping on an international website, this is what payment methods they use the most:
"SEPA direct debit 35%
Sofort/Giropay 16%
Open Invoice 15%
Visa 14%
PayPal 10%
MasterCard 9%
American Express 1%"
Overall, there are "53 million digital buyers in Germany of which 98% are internet users and 32% are online on a regular basis".
CONCLUSION
In German e-commerce, 59.5% of people pay completely upfront. Additionally, 30.5% pay by using Invoice, 20.2% pay with debit cards, 12.2% pay using credit cards. SEPA direct debit represents 35% of online payments, VISA accounts for 14% of online payments, followed by MasterCard with 9%. There are 53 million digital buyers in Germany of which 98% are internet users and 32% are online on a regular basis.