The German M-Payment Movement


Cash is king in Germany – but maybe not for long. TSYS took a look at the payments habits and desires of the German consumer and found a surprising interest in using mobile phones to pay in-store. Will cash soon be a thing of the past there?

Maybe not right away, but the German consumer is increasingly interested in mobile phones as payments devices.

According to the TSYS German M-Payments Consumer Research Report, nearly 69 percent of respondents showed interest in using m-payments for their in-store purchases over the next two years.

For the more than one in four respondents who reported making an m-payment within the last six months (27 percent), the satisfaction rate of the payment experience was ranked relatively high, which TSYS said corroborates the positive indicators conveyed globally surrounding the increased use of m-payments.

“There is also a recognized link between customer satisfaction, retention and word-of-mouth advocacy. Given the high level of satisfaction of those who used m-payments, we expect the cycle of trial adoption and user-base growth to reach critical mass in the near term,” the report stated.

The most frequent m-payment users among the respondents said the mobile payments they made within the last six months took place online via sites such as Amazon and eBay (59 percent), to make purchases through mobile apps (50 percent) and to buy clothing (45 percent).

In these scenarios, TSYS suggests the actual user experience was tailored specifically for mobile devices by the developers and eCommerce retailers, which may account for a significant usage reported by shoppers.

While TSYS’ report shows an enthusiasm among German shoppers for the use of m-payments, it also highlights concerns about safety and security when it comes to the emerging payment method.

The most common apprehensions the survey respondents showed involved fraud and information security, with nearly 81 percent of the German shoppers identifying the risk of losing their mobile device and subsequently having their sensitive information compromised as a leading concern.

The risk of unauthorized access to private information while it is sent wirelessly using contactless technology was reported as a concern for 78 percent of shoppers surveyed. Privacy was also a seen as a significant issue, with 71 percent of surveyees expressing unease that their shopping history and habits could possibly be tracked by hackers.

The belief that inherent security issues will accompany the use of mobile payments is not uncommon, but TSYS suggests there is also an opportunity to address these concerns through the use of marketing campaigns that showcase how m-payments utilize advanced security technologies and are backed by the same fraud protection policies as card-based transactions.

The research report found that 74 percent of respondents do not believe security is a benefit of using m-payments in-store. However, more than 69 percent expressed interest in using m-payments if providers and merchants are able to guarantee security and fraud protection.

Instilling trust and understanding among m-payment users is a crucial step in growing the adoption of m-payments among German shoppers, but as TSYS pointed out, so is building the rollout of point-of-sale (POS) terminals that accept contactless payments.

German retailers are expected to replace 200,000 to 300,000 old payment terminals over the next three years and will most likely move to ensure contactless payment functionality is available.

“A frictionless experience would surely help the increase of m-payments adoption for in-store purchases — and that is hampered when cardholders cannot find places to use m-payments,” TSYS’ research report explained.

“A main problem in their proliferation remains retailers’ resistance in adoption of terminals capable of hosting m-payments in-store. While this is likely a short-term phenomenon, the industry should remain vigilant to ensure the ecosystem continues to grow,” the report continued.

To download the full “German M-Payments Consumer Research Report” and gain access to additional insight and analysis on the entire survey, please click here.



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