Pandemic drives development: Cashless payments are increasing in the euro area


Pandemic drives development
Cashless payment is increasing in the euro area

The reduction in contact in the Corona crisis also means that people in the euro area are increasingly turning to cashless payments – whether by card, bank transfer or electronic means of payment such as Apple Pay. There are, however, major differences between the EU countries.

The trend towards paying without notes and coins received a further boost in the Corona crisis in Germany and the euro area. Last year, almost 102 billion payments (previous year: 98 billion) were processed cashless in the common currency area, as the European Central Bank (ECB) announced. The total value of the transactions rose by 8.7 percent year-on-year to a good 167 trillion euros.

Almost half (47 percent) of cashless transactions were card payments, and almost a quarter each were transfers (23 percent) and direct debits (22 percent). According to the ECB, the rest were among other things electronic means of payment such as Apple Pay or Google Pay. The share of payment by check is just around 2 percent.

According to the Bundesbank, debit cards such as the EC card issued in Germany were used 25 percent more often for card payments than in 2019. In the first year of the pandemic, people increasingly paid smaller amounts with plastic money. A total of 26 billion payment transactions with a total value of around 61 trillion euros were processed cashless in Germany. Compared to the previous year, this corresponds to an increase of 8 percent (number) and 3 percent (value), explained the Deutsche Bundesbank.

Contactless payment benefits from hygiene rules

In times of the corona pandemic, for example, contactless payment at the checkout is considered particularly hygienic. Because customers do not have to insert their credit card or girocard into a device. Instead, the data is transmitted in encrypted form when the card is held in front of the reader. In the case of small amounts, it is not even necessary to enter the secret number (PIN).

However, there are still major differences in the use of the most important payment services within the euro area. According to the information, Portugal has the highest national percentage for card payments at around 70 percent. The share of transfers was highest in Slovakia at around 38 percent; in Germany, the share of direct debits is particularly high at a good 44 percent.

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