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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.
Three breakdowns of online payment methods in Germany were found and invoicing, PayPal, direct debit, and credit card all figured in the top four of each of these breakdowns. Among these breakdowns is the following breakdown by the EHI Retail Institute: payment on invoice (30.5%), direct debit (20.2%), PayPal (17.9%), credit cards (12.2%), installments (4.5%), payment in advance (4%), payment at outlet (3.6%), SOFORT Uberweisung (2%), payment on delivery (1.9%), payment with Amazon (1.1%), and others (2.1%). While no breakdown of those who pay upfront is readily available, the top four options for paying upfront that are offered by online merchants in Germany are Mastercard credit card (92%), Visa Credit Card (91%), American Express Credit Card (66%), and PayPal (63%).
ONLINE PAYMENT METHODS MOST USED BY ONLINE SHOPPERS
There are a number of breakdowns of online payment methods in Germany that are available online. Even though the breakdowns differ from one another, invoicing, PayPal, direct debit, and credit card all figure in the top four of each ranking.
For example, based on an article published by Germany-based payment software provider Optile last July, the payment methods most used by Germans are as follows:
Invoicing - 39.9%
PayPal - 30.9%
Direct Debit - 11.4%
Credit Card - 11.2%
SOFORT Uberweisung (instant transfer) - 3.3%
Even though invoicing is the most used payment method among Germans, Optile notes that its popularity is waning while PayPal is gaining ground.
The numbers in eMarketer's April 2016 article tell a different story, though. Unlike the ranking in Optile's article, payment systems (including PayPal) take the top spot. As of January 2016, the payment methods primarily used by Internet users in Germany were:
Payment systems - 43%
Open invoice - 29%
Credit card - 9%
Direct debit - 8%
Prepayment - 5%
Other - 6%
Payment systems, open invoice, credit card, and direct debit have consistently been the top four payment methods from 2013 to 2016. Payment systems refer to PayPal, ClickandBuy, Sofort Uberweisung, and giropay. 'Other', on the other hand, refers to cash on delivery, deferred payment, digital payment solutions such as Billsafe and Klarna, and payment on installment.
EHI Retail Institute has its own ranking as well. According to this institute, the share of each e-commerce payment method, by revenue, in Germany is as follows:
Payment on invoice - 30.5%
Direct debit - 20.2%
PayPal - 17.9%
Credit cards - 12.2%
Installments - 4.5%
Payment in advance - 4%
Payment at outlet - 3.6%
SOFORT Uberweisung - 2%
Payment on delivery - 1.9%
Pay with Amazon - 1.1%
Others - 2.1%
Regarding your question about the previous response, it appears the Ayden.com source that contained the statistic that SEPA direct debit accounted for 35% of online payments is not as reliable as it appeared to be. It is only in this report that SEPA direct debit ranked first and invoicing ranked only third.
BREAKDOWN OF ONLINE SHOPPERS WHO PAY UPFRONT
There is no pre-compiled breakdown, by type of card or facility, of consumers who pay upfront, but, from the perspective of online merchants, the payment methods they implement or offer the most are:
MasterCard Credit Card - 92%
Visa Credit Card - 91%
American Express Credit Card - 66%
PayPal Wallet - 63%
SEPA Direct Debit - 43%
SOFORT Uberweisung Online Bank Transfer - 41%
As can be seen from the figures above, more than half of online merchants in Germany offer the MasterCard Credit Card, Visa Credit Card, American Express Credit Card, and PayPal payment options, which online shoppers can use to pay upfront.
Though these percentages are from the point of view of online merchants, they are indicative of what online shoppers commonly use.
ADDITIONAL INFORMATION
According to Optile's article, invoice users are mostly aged 50+ while PayPal users are mostly young people. Optile also notes that the average amount spent by Germans on online shopping each year is €670 (or around £592) and that "24% of Germans will cancel their checkout process if the e-merchant does not provide their preferred method of payment."
Online retailers in Germany provide their customers with 5.3 payment options, on average, according to an article published by solutions provider Wirecard in April 2016,
CONCLUSION
Invoicing, PayPal, direct debit, and credit card are the payment options predominantly used by online shoppers in Germany, as indicated by three breakdowns of online payment methods that were found. One of these breakdowns was by the EHI Retail Institute, which provides the following percentages: payment on invoice (30.5%), direct debit (20.2%), PayPal (17.9%), credit cards (12.2%), installments (4.5%), payment in advance (4%), payment at outlet (3.6%), SOFORT Uberweisung (2%), payment on delivery (1.9%), payment with Amazon (1.1%), and others (2.1%). There is no existing breakdown of those who pay upfront, but the top four options for paying upfront that German online merchants offer are Mastercard credit card (92%), Visa Credit Card (91%), American Express Credit Card (66%), and PayPal (63%).