About the German speaking market
DACH stands for Germany, Austria and Switzerland. These nations, and not to forget Luxembourg to be complete, provide the German speaking market with a population of over 95 million.
If you seriously plan to start a business here, you should be aware of the particular preferences of German Internet Users. Studies such as the Pago Report 2005 show two main features of the German online customers:
First All in German language – Germans make up more than 95% of their online purchases on German websites. Seccond, preferences for paying by direct debit – Nearly 60% of all transactions are made by direct debit. The share of credit card payment for online trading is lower than 38%. Only about 20% of the Germans own, or use a credit card. Direct debit is on of the most favourized payment methods. In the D-A-CH area a client who wants to buy something on the Internet has currently over 30 different payment methods to choose from.
Approx. 30 payment methods, all of which have certain advantages and disadvantages. Therefore, nobody can really say, that there is THE or THE new payment method for online retailers. For the foreseeable future there wont be any method to succeed to establish as a standard, because the business models are so diverse. Possibly there will be some new providers establishing in the payment landscape due to a quickly reached critical mass of relevant participating dealers and customers. So these providers will be used in more and more markets too. However, even these players meet just certain conditions and not all the requirements of dealers and customers.
Relevant payment infrastructure
There is a national debit card network under the name EC electronic cash (now girocard), wich is by far the most accepted and most common card network in Germany. However, this system inly works with German cards.
The international functionality of German electronic cash card has been ensured by a so-called co-branding with Maestro, a trademark of MasterCard. Each ATM card is also a Maestro card and could be used abroad with all Maestro acceptance.
Meanwhile, there are also EC cards issued with a VPay co branding instead of Maestro. The VPay system was introduced by Visa as an alternative to Maestro, it works only in Europe and then only at chip-enabled terminals. A use in non-European countries is hereby no longer possible.The use of the Maestro or V PAY functionality in Germany, however, is contractually excluded by the co-branding agreement in order to prevent direct competition with electronic cash.
Foreign Maestro or V PAY cards are not accepted in Germany at pure electronic cash tills. Because each EC-point of acceptance must accept foreign cards through a separate agreement with their respective payment service providers, this is regularly associated with additional costs. Particularly in local retail stores and, for example, in most supermarkets, the acceptance of foreign cards can not be expected.
Girogo and GeldKarte was introduced by the coorporative banks network in 2012. There are already about 92 million debit cards in circulation (around 97% of all girocards) Payment guarantee for merchants at lowest settlement fees. The payment process is very similar to the normal electronic cash. Instead of the magnetic stripe, the chip is used, which also carries the cash card function. The chip is loadable with a bank pre-defined limit (eg EUR 500, – within a week), of which the dealer may deduct its revenues. If there is enough limit stored on the card, the transaction will only be processed between the card chip and the terminal, telephone costs are not incurred.
Payment Service Provider located in Germany
Heidelberger Payment GmbH is your Full Payment Service Provider in the sector of Ecommerce.
Heidelpay, as one of the leading European Service Provider concerning the topic payment within the worldwide E-Commerce, currently processes payment procedures for more than 6000 customers from all areas of E-Commerce and acts at it as a complete solution provider. Thus heidelpay offers everything concerning Online-Payment. From the processing of payment transactions to various risk management-functions and a debtor management, up to the placing of corresponding acceptance agreements.