The German EC-Karte oddity

eckarteToday in Berlin I bought a bike. With cash. Yes, with a wad of €50 and €20 notes. Why? Because the bike store accepted only the German EC-Karte debit card, and not credit cards. On Thursday I will need to buy some furniture in IKEA and, as confirmed on their website, again credit cards are not allowed. So, because it takes some time to get all the information together to open a German bank account, again I will be off to the cash machine and drawing out a bunch of notes.

Sorry Germany, but this is absurd. Most of the rest of Europe has fixed this, and long ago. In UK, Denmark or Sweden I can pay more or less anywhere with a UK Visa or Mastercard. Even in Belgium it works most of the time, and even SNCB now accepts Visa. But for IKEA, that very symbol of globalisation, to not accept global payment cards? That’s absurd.

Yes, I understand that Germans are not keen on credit cards. But there are systems for Visa Debit and Mastercard Debit. It does not mean that international compatibility must mean the spread of credit cards. There is also some Maestro – EC-Karte compatability, but for that a Maestro card is needed somewhere else, and none of the three bank accounts I have in 2 countries have it.

When it comes to cross-border payments, it seems we still have a long way to go…

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42 comments

  1. Chrissie Briggs

    Over the last 2 years of visiting Germany less places accept English Debit cards in Germany as well. 3 years ago it was easy to pay with Visa or Mastercard eating out in Germany, although some places only accepted one or the other. Over the last 2 years, after asking if a place accepts cards I was told it was fine, until they realized I was using an English card, I carry Visa credit and debit cards plus a mastercard, I was told on eating out that these cards are not accepted.
    It’s fine to use any of these cards to buy train tickets however. Hotels also seem to accept them, but eating out is a case of getting cash first.

  2. Max

    Many Germans bank with their local Volksbank or Sparkasse because they’ve had an account with them their entire life, even though the conditions are usually very uncompetitive. Competitive instruments such as the UK’s Current Account Switch Guarantee would not be acceptable to the established institutions.

    But still consider to open a secondary current account with another bank.
    Consorsbank/BNP Paribas Deutschland do issue true Visa Debit cards with their – free – current account. Unfortunately, for some obscure reason they are not allowed to use the Visa debit logo on the card (even although the EMV App Id on their card is “Visa Debit”), but this won’t matter if you only use it online. EasyJet for example does accept their cards as a Visa debit card so won’t apply a credit card surcharge.

    I am quite confident though that this will become a non issue with the EU’s interchange fee regulation. For example Lidl, Aldi, and Netto have recently started accepting Visa and MasterCard, both credit and debit. Fidor plans to introduce a genuine Debit MasterCard to the German market this fall or winter. And once larger commercial banks hop onto the bandwagon, the early 90s fossil that is the girocard will hopefully be confined to museums sooner or later.

  3. Jordana

    another oddity is the debit card thing. i am german but spent a lot of my time in the UK, on some UK Online Companies i can’t pay with a Credit Card but i could pay with a debit card – a debit card in the UK is something absolutely different than one in Germany so i can’t pay on these platforms, neither with credit card nor my bank card. The guy in the german Berliner Volksbank thought I am crazy and the guy from the UK company just repeated constantly just put in the number from your Bank card, CVC number and exploration date from your debit card…. I do not have a CVC number on a german Bank card …argh!

    My english pay as you go sim, I can’t top up with a „german“ credit card for the plain and ridiculous reason that the adress forms from the phone companies in the UK has other fields than german ones so is the Postleitzahl before the city etc. so they just won’t accept my card – i have to send money via transfer wise to a friend who than buys a top up and sends me the number and all that in 2015.

  4. Brian Rockwell

    All good points Nathan. I too, travel all over the world for work, and live in northern Germany until next Christmas, give or take. I echo your sentiments regarding remote locations. I was in Kangarlussaq (Sondrestrom), Greenland, waiting on standby for a company aircraft should it need to land there. We’re talking an ex-American air base with little more than a giant runway designed to land B-52’s, a couple hangars now occupied by Air Greenland and the Danish Air Force, and a small hotel with a cafeteria and grocery store. Maybe, and I mean MAYBE, 200 people live in this outpost. And do you know how many places took my Visa card? If you answered ‘all’ you would be correct. So you can imagine my surprise when I got to Germany for the first time on that same trip and went to pay for a few groceries and some shampoo at the Netto and my Visa card was not accepted (and of course, no Euros in my wallet). I’d heard at some point, that Canada was on the leading edge of electronic banking (you can use your NFC equipped cell phone as a contact-less Mastercard or Visa with some banks and terminals) but had no idea some countries were so far behind the times.

    Anyway, we could go on and on about how much value credit cards and POS systems have improved our lives, from the convenience and safety of not having to pack thousands of dollars/pounds/euros to your favourite store to buy that new whatever (lose your card, call and cancel, lose your cash, shit out of luck) to the insurance (my Amex card has too many to list, car rentals, lost baggage, hotel robbery, extended warranties on electronics, on and on) but I doubt those that have such a hate on for credit companies are going to be sold on the concept. Polly is certainly not the only one.

  5. Nathan

    I live in the City of Leeds in the UK but travel all over the world with my job. Almost everywhere I go to accepts Visa and MasterCard except Germany. I find this highly frustrating.
    A lot of places now are even accepting contactless payment. I was in North Finland last month close to the Artic Circle and I was using contactless there!
    With regards to the fees the credit card companies charge they are not that much.
    I have just last week set my fathers business up with a chip and pin machine and the fees are very small. Depending on the size and the amount of transactions you will have per month are different accounts you can set up. For example a small level single trader, for a transaction of £5 it only costs £0.10. For a corporate company the fees would be even smaller.
    The amount of money German companies are loosing from foreigners/tourists must be staggering.
    I was working in Duisburg last Christmas and was at the till in Media Markt with 1300 euro computer. I handed my Visa card to the cashier and was told “sorry we don’t accept credit cards” the thing was it was a Visa debit!
    For whatever the fee German consumers get charged surely them loosing my business is more harmful? I didn’t return and buy the computer with cash as it would have taken me 3-4 days to withdraw that amount in cash from the machine.
    I am just one person, but imagine how many other people from around the world have had the same frustration – that’s MILLIONS of lost revenue per year.
    Cash may be easier to manage but it depends if you withdraw the cash from your overdraft, in that case you are borrowing. That is no difference to a credit card. Most people I know (including myself) pay off the balance at the end of the month anyway without accruing interest.

    I personally am happy for the corporate companies to take a small fee for making our lives easier and more convenient.
    Last year I took 35 flights to multiple countries, can you imagine if every time I landed and wanted food I had to withdraw cash. How much of a hassle would that be? How much wasted money would I have left if I only wanted a sandwich for 2 euro, or 200 rupees, 5 dollars and had to withdraw an even larger minimum amount from a cash machine. Sometimes when you are working its hard to find a cash machine!
    In Korea all the taxis have Chip and pin machines on the dash board. How convenient? Very!

    Polly – The small fees that these companies charge have enabled their services to be rolled out all over the world to make our lives easier and more convenient. Who doesn’t want an easy and convenient life??
    These fees which the retailers pay (not us the consumers) have created thousands of jobs to support people around the world, how is that a bad thing?

    Do you really want to make that trip to the cash machine 5 miles down the road in the pouring rain just so you can go the shop to buy a bottle of milk from the shop next to your house? No.
    Do you really want to carry a pocket/wallet full of money every time you go out shopping, rattling around with all the coins, leaving you wide open to be mugged? No.
    Isn’t life stressful enough without worrying about if you have enough change for the train fair or if you “stored enough cash on you”.

    Aldi and Lidl in the UK accept all credit/debit cards and even contactless now!

    Unfortunately cash is in the decline in most Western countries. Germany needs to realise this and change their ways as this will be preventing their economy from growing as fast at it could be.

  6. Brian Rockwell

    Heh, ‘aside from the upfront cost of renting an Internet connection’….

    So you do apparently understand that electronic infrastructure costs money.

    ‘Just connected networks with a certain level of security’……

    Those must come free too nowadays, all those people to manage all those servers, not to mention the cost of the hardware itself and the network connections to keep them talking to each other. Can you please point me in the direction of the free-labour-and-materials tree? I have some business ideas that could greatly benefit.

  7. Max

    Fraud prevention is not free. (And even cash isn’t exactly free – the cost associated with counting and transporting the bills, counterfeit money etc. must be borne by somebody.)

    I don’t expect card acceptance at a garage sale or something like that. But when I am at a store, spending a larger amount, or dining at a full service restaurant I do expect that both domestic and international cards are accepted, as the cost of card acceptance is quite negligible nowadays (even more so if compared to meal vouchers that many places happily accept at a ludicrously high cost to the retailer!).

    This has very little to do with cost or effort. It’s just that, erm, many people don’t have an entrepreneurial point of view. After all it’s much easier to moan about one’s own commercial mediocrity and put the blame on others (banks, competitors, Amazon, the internet, the government, etc.).

  8. Polly Thurkettle

    Oliver, you come across as a fully paid up member of the banking cartel. If you can’t grasp the concept of free commerce, you shouldn’t be commenting on it. It’s been proven time and time again that it’s possible for two parties to carry out a transaction without the interference and parasitism of payment processors and their agents. You also seem to misunderstand the nature of money. If I want to sell my car for cash, I don’t reserve 3% of it to pay some middle man for, well, absolutely nothing at all. If I connect to the Internet and download a file or upload some photos, I do so for free, aside from the up-front cost of renting an Internet connection. Electronic commerce is no different – just connected networks with a certain level of security. Why anybody believes that it’s justified to charge such outrageous fees for doing something which is essentially free or extremely cheap is beyond me and quite understandably, beyond many sensible German retailers.

  9. Oliver

    Polly, you come across as a communist with your over simplification and line that transacting should be free and we should all be using cash! It would still cost the retailers to have their own payment gateway and network taking your proposal. So that solution cannot therefore be free. Nothing provided and providing convenience with such an infrastructure can be free, just take water as an example! Cash is not free to handle, as you yourself say, as there are storage costs, plus security costs and money changing costs. You don’t have a serious solution and criticise the players and the UK without seeing the bigger picture, which essentially boils down to the need for both payment network integration and willing parties. There are willing customers, willing payment network suppliers just not willing retailers! That’s what’s baffling us. Germany and its retailers are the main losers and just some annoyed foreigners who were one willing buyers, thwarted by this stupid attitude.

  10. Polly Thurkettle

    It’s just an electronic payment system, not rocket science and certainly not worth the money retailers pay for the “privilege” of accepting certain credit and debit cards. German retailers obviously have more sense that in the UK.

  11. Brian Rockwell

    I don’t work for either. Your assertation is that we should do away completely with the ability to loan and borrow, which again, is almost impossible and an over-simplification of POS systems.

    Also you don’t seem to know that Visa and MC are merely computer networks. They are only a system by way a merchant can communicate to a bank, and their share of the transaction fee is minuscule. Cards are issued and maintained by banks, so if you have a problem with the fees you should take it up with them. Or should we do away with banks too?

  12. Polly Thurkettle

    You can argue all you want that these plastic money changers are doing the world some great service. The fact is that doing the transaction in cash costs nothing except the cost of storing the notes and coins. Retailers should club together and form their own, free payment systems. It’s time the Visa/Mastercard cartel was taken down. There is no “default risk” if somebody goes into a shop and pays in cash or with a bankers draft or equivalent. People who argue that it’s OK for middle men to cream off a percentage of every transaction are deluded and must either work for the card industry or a bank.

  13. Brian Rockwell

    I suspect it’s less to do with privacy concerns and transaction fees, and more to do with these companies (in the case of the big box retailers) only accepting their own branded credit cards. You’ll notice that IKEA, Hornbach, Hagebaumarkt, MediaMarkt, they all have their own credit cards. And in the case of the Hagebaumarkt, I went in there and tried to spend €600 and pay with my Visa, and after the cashier said they didn’t take it and I was on my way to leaving empty-handed, the manager came over and begrudgingly accepted it.

    Also Polly, credit cards do actually provide a service in that they remove the risk of default from the merchant (as opposed to cheques). Your assertation that they only provide a card reader is an over-simplification.

  14. Polly Thurkettle

    One might understand banks and those companies with a monopoly on payment services charging something to the seller if it provided the seller with any real benefit other than a card reader but the fact is, in the age of electronic payments, it’s scandalous that any third party can take a cut of a transaction between two private individuals, just so they can exchange money. It’s just another tax on spending. Bitcoin, albeit a volatile medium, allows unlimited transactions for free. Why can’t Mastercard/Visa et al. do the same?

  15. Max

    Coming back to the EC/girocard discussion and why this dinosaur is still alive:

    The girocard, formerly called Electronic Cash, is a domestic card scheme, an ugly sibling of Maestro or Visa Electron. German debit cards are usually girocard co-branded with Maestro or V Pay, but the latter functionality is only used abroad and it is feature frozen. With very few exceptions, German Maestro cards cannot be used in a card not present transaction unlike a proper British or Eastern European Maestro card, as the 19 digit card number (672 + 5 digits representing the issuing bank + 10 digits for the account number + Luhn checksum) and CVV are not shown on the card. Feature freeze also means no Maestro PayPass in Germany, whereas the Netherlands have abolished their domestic PIN scheme and replaced it with international Maestro and V Pay and are now embracing contactless!

    E-commerce in Germany is a PayPal, Direct Debit or SEPA transfer thing but rather dodgy workarounds solutions such as “Sofortüberweisung” (me personally, I wouldn’t give any third party website my online banking details) are now also popular because of the lack of a proper multifunctional debit card.

    girocard also has the added disadvantage of a comparatively high minimum transaction fee to the merchant (about 8 euro cents). Paying small amounts by card is frowned upon or often outright refused. Also, girocard cash withdrawal pricing is an extremely questionable thing with surcharges/access fees that can be as high as € 7.50 if you are withdrawing cash with a girocard from an ATM of the wrong sub-network, of which there are four (savings banks, credit unions, Cash Group (larger privately owned banks), Cash Pool (smaller privately owned banks)). I suspect this national scheme is so popular with German banks because they can charge third party customers outrageous amounts of cash withdrawal fees.

    Some German banks (such as Consorsbank, ING-DiBa, Fidor and Number26) have already introduced or are in the process of introducing Visa Debit or Debit MasterCard* with their current account for free international cash withdrawals, as V and MC withdrawal fees are capped (and the banks will happily eat the charge) unlike girocard withdrawals. In rural regions of Germany, some publicly owned savings banks (Sparkassen) and credit unions (Volksbanken) have responded by leaving the Visa network altogether, even though cash machines can be operated profitably with Visa interbank fees. Others restrict cash withdrawals to € 50 per Visa transaction (as an example, Mittelbrandenburgische Sparkasse operates an ATM with such a restriction at Berlin Schönefeld Airport), although Visa International regulations require that at least € 200 must be withdrawable per transaction, given sufficient funds on the account.

    We’ll have to assume that international tourists are unwelcome in those regions. There is great pride in Germany when it comes to the social market economy, but this obviously does not include financial inclusion. If you’re living in the wrong town or district you might have no choice but to bank with a certain network.

    (* Ironically none of these banks uses the “Visa Debit” or “Debit MasterCard” brand. I assume this is some kind of misguided consideration towards their competitors. Some savings banks and credit unions (not all of them though, I’ve never had problems with Berliner Sparkasse ATMs with both domestic and foreign cards and they have a fairly competitive fee schedule for their own accounts, unlike some rural savings banks) are acting like the huge, supposedly “evil” commercial banks in the UK did in the 90s before they finally joined LINK, ending the era of ATM “disloyalty” fees. But by definition, savings banks and credit unions are “good” and their policy must not be questioned. This is Germany, like it or not.)

  16. Oliver

    The speed of a cash transaction being much faster than a card is pure nonsense. How many times have you waited in line for the elderly or infirm or just someone who is just basically unaware of others, taking for ages to dig out of their purse, loose change and notes and even striking up conversation with the checkout person. No cards are faster than cash!
    The cab drivers in London all used to tape notices saying “card machine not working”over their card machines in the cab because they could bury some of the cash takings, but that is rapidly changing as passengers have switched to private taxi companies that offer all round more convienience including payment!! Retailers everywhere must see that this is important too consumers and cash is dying do you have to have a business model that works with PayPal and international credit and debit cards not just cash.

  17. Oliver

    Max, thank you.
    Inciteful, helpful and correct.
    I will leave bad reviews for poor payment handling with any German retailer who isn’t getting with the programme and thinking of the customer first on this issue, e.g. Many. It’s the only way to realistically bring about change.

    I already cancel an online transaction if Paypal is not offered as a payment option, as why should I have to bother filling out all my details and card information when basically I don’t have to! Same applies in shops with cards. I actually prefer contactless payment as I have a poor immune system and don’t want to catch bugs off a chip and Pin machine if I can avoid it. That’s a whole other topic!

  18. Max

    I think part of this is just German attitude. With two dictatorships in the last century many are obsessed with privacy in their everyday lives and always prefer paying by cash. Also taxation is an issue, it is easier to stash away profits from a cash only business (even though I certainly don’t recommend this).

    Some places will not accept cards but meal vouchers such as Sodexo or Ticket Restaurant which is really irritating. The acceptance of such vouchers incurs a fee of almost 5% on the side of the retailer. I’ve asked one store manager why they accept the more expensive meal vouchers but not cards. “Cash is faster, chip and pin/signature is very slow”. This is no longer an issue with the advent of contactless payment but of course one would have to think out of the box. It won’t happen this year and won’t happen next year with many people considering contactless payment a security issue, not an innovation making life easier. So the only thing one can do as a customer is leave bad reviews on Yelp or Google places and give feedback.

    Fees for card acceptance are rather high in Germany. But even the most simple plan (from SumUp, payleven or iZettle) will only cost the merchant 0.95% for girocard/Maestro/V Pay payments and 2.75% for Visa or MasterCard payments. It certainly is not as bad as it used to. Many Saturn and Media Markt stores now accept Visa and MasterCard (however require photo ID, even though MasterCard’s merchant regulations expressly forbid requiring this – reason supposedly that Chip and signature is insecure – I don’t get why German banks have not moved their international cards to proper Chip and PIN though, in such a safety and security obsessed society?).

    As it’s primarily an attitude problem and not a fee problem I wouldn’t expect small businesses to change in the near future though.

  19. T

    @JP Still Mastercard would charge a significantly higher percentage than Maestro, so merchants are not too keen to accept those. This site http://www.zahlungsverkehrsfragen.de/kartenzahlung/kosten-der-kartenzahlung explains a lot of that stuff and all those different logos, if you really want to know and your German is up to it 🙂

    However, with EU preparing to cap those fees at a maximum of just 0.3% (that’s the interchange fee, paid by the merchant’s bank though – his bank might still charge him more) this might just change soon … ?!
    (http://italia2014.eu/en/news/post/dicembre/interchange-fee-regulation/)

  20. JP

    Hello everyone!
    I’m currently living in Germany and I can relate to the frustration regarding making payments.
    I just can’t believe that American Express, Visa and MasterCard are simply not accepted; Perhaps I could understand in small supermarkets where checks don’t go over 50 Euro, but e.g. at Saturn (kind of a German Best Buy), IKEA or at places usually visited by tourists such as McDonald’s or Burger King, still these cards are not accepted.

    I too can’t understand why, if Maestro Cards belong to MasterCard, the same devices can’t read MasterCard Debit Cards. Can someone explain me?

    Best Regards.

  21. Oliver

    BTW, I now actively avoid certain restaurants and shops that don’t take my cards. Kaufland and Euronics are just two examples of German businesses losing out to competitors seemingly over card charges. This is their issue, certainly not mine, I wasn’t given a choice! Bravo Edeka! and what a fine German supermarket that is. Viele Grusse.

  22. Oliver

    Guys this is a terrific blog and debate.
    In my view Buisness or the lack if business starts with the customer, not the retailer. With four companies myself you always start with the customer and their needs not yours, and you provide a service that’s easy to buy and easy to use. It all starts there. If you own a business and a customer is going to make a minimum spend in keeping with your Buisness, then would you rather they walked away at the till rubbishing your service, or would you rather sell to them and serve them? Mutual benefit.

    I’ve been in Germany for a few months now and am go smacked how hard it is to use visa and MasterCard or Amex. I went to Euronics and took to the counter about 200 euros worth of kit to the counter only having to walk away from the till and the potential purchase because they wouldn’t accept my cards. Now how daft is that? If I was the CEO I would be very concerned about this and at least say we don’t accept these payment options. The same thing happened to me after shopping in Kaufland for an hour. You can imagine our frustration! The EC card is not explained as a Maestro card. The words EC imply European,which is incredibly misleading when you are instead presented with this as your payment option, and I have never seen an EC card logo on a physical card in the UK or other parts of Europe.

    Someone smart here suggested payment gateway roaming charges! I like that idea!

    In my view it’s not up to the retailers to decide who uses credit to pay for their goods, that’s a consumer choice. It’s the retailers service obligation, for which they can pass on the cost if they like to the consumer, affording transactional service. Come on Germany and anyone else refusing to accept payment, find a solution, that’s called service! I know that is a little alien to my German friends, but everyone has to do business internationally and with tourists after that’s good for everyone and tourists aren’t going to have EC cards. Do you want their business or not?

    Last point, and I’m not saying this is fact, I have just heard it. Amex say that although their transaction charges are higher than other payment gateways, their customer base spend more money on average per transaction than with other payment providers, so this is something to think about if you’re a retailer. Sure create a minimum spend, but please just take my cards or accept PayPal or someone so I can pay on the spot and not try and find a cash machine that will also give me Euros using visa or MasterCard, and without charging me first, like in Kaufland!!!

  23. Wiel

    That’s true. I actually never (except Belgium) encountered that my Maestro card wasn’t accepted. To be honest, Mastercard / Visa aren’t world wide payment systems. They are method of payment, but originate from domestic US use and since then spread a bit around the world. You can see it easily, if Americans come there, there will be creditcards accepted at certain shops. If not, then nope.

    You would be fine to pay the extra charges, that’s nice, but to be able to accept creditcards, you’ll need different POS’ses, pay a extra monthly surcharge and wait longer for your money. And to top it all off as a business owner I’ll need to pay an x % to the creditcard company… Why on earth would I do that? For that customer that comes in one a month and spends, let’s say, € 100,-. Nope, I’m not doing that. The costs simply do not outweigh the business that I’m getting.

    By the way, a German card ís a domestic card, but starting as of 2006 they’re issuing the cards with Maestro and V-pay support. All the ATM’s should be Maestro and POS’ses compatible (never had any issues there)

    And the main reason why retailers like Ikea aren’t buying in to creditcards is easy. Why should they? They don’t want to pay top dollar to creditcard companies. It’s that simple. The costs out way the benefits.

    It’s a hassle sometimes, but remember. You are in a different country and hard currency ís still accepted, albeit it can be a real hassle and freaking annoying. Still, different countries, different ways.

  24. Jon

    @Polly / Mark / Wiel – there are a bunch of issues here.

    1) Charges – I am fine if these are labelled, and indeed would be ready to pay extra for the convenience in some circumstances.
    2) Credit vs. Debit – here too I don’t care. I just want to make sure that my card is accepted in as many countries as possible, regardless of whether it’s credit or debit. If Belgian and British debit cards can be compatible, via Maestro, why not the same for Germany?

  25. Wiel

    Creditcards in Europe only exist by grace for paying in credicarded countries, NOT for paying in the domestic countries. Why should you borrow when you have got the money already… It simply doesn’t work like that… Just go debit, besides its a sensible thing, it will be accepted almost everywhere.

  26. Mark Wilson

    I’m not buying goods in a “foreign land” though, Polly. I live here. I have a German account and a German credit card.

  27. Polly

    I completely sympathise with German retailers refusing to accept a middle man creaming off a percentage for transactions which are essentially free. Universal payment is not a right, it’s a convenience. If you live in Germany, pay with a method that’s mutually agreeable to both German retailers and consumers – after all they are running businesses. If you buy goods in a foreign land, you wouldn’t expect the retailer to accept your own currency and bear all the costs of converting it, reducing their margin etc. Why do you expect the same with electronic payment?

  28. akjklgajlgs

    I have frequently noticed this problem in Denmark, Germany and the Netherlands. In Germany and the Netherlands, many shops only accept Maestro cards, and very often only domestic Maestro cards. Maestro cards are not commonly used in my country, and my bank doesn’t issue them, so I don’t have any. In Denmark, some shops only accept the domestic Dankort card, although those shops have been getting less common in recent years. The problem, though, is that most Danish shops charge a fee if you wish to pay with an international card. This is often not indicated, and even if it is indicated, this is often only in the form of a hardly visible notice in Danish which doesn’t even tell how big the fee is (e.g. a hidden notice saying “gebyr ved brug af udenlandske kort”). Danish shops charge a bigger fee if you wish to pay using a credit card, and from my experience, non-Danish debit cards are always misidentified as credit cards.

  29. Mark Wilson

    Very good blog post. After living here for 3 years I’d say the reason is the % they have to pay. German businesses often act in a strange way that most often does not benefit the consumer. It’s interesting that in my neighbourhood new shops, bars and restaurants (often run by non-Germans) have started to accept credit cards as they see the opportunity rather than the cost.

    The Ikea example also astonished me. More so, was when we went to Ikea, spent over €1,000 and had to provide a passport. We did not have it with us and it took a lot of convincing to allow us to spend money with them.

  30. Wiel

    Maestro is the way to go. Even in the remote skirts of Chile and Bolivia I could use it. Like others stated before me, the rates for creditcards are higher. As is the payment to the store. The latter being the biggest problem. Creditcard companies hold the money longer when it’s from a creditcard then from a debit card, in which transfers are within 4 – 48 hours, depending on the type of plan you have.

    Also, remember, in mainland Europe people are not so keen on creditcards. Debit cards are much more accepted. Still I think it’s odd that you can’t easily get a Maestro card in Germany. I know that here in the Netherlands, stores don’t accept creditcards, it all has to do with the costs. Since they can’t forward the costs to the customer they wind up paying for them themselves, and that’s not something they want. In every ATM you can withdraw cash, even with a creditcard, so for the Dutch there’s no problem there. And the Maestro is the international system, the local Maestro (based loosely on the international) was abandoned a couple of years ago with the introduction of EMV cards. The GC system in Germany was (and still is) compatible with that of the Dutch. So you should be able to pay with Maestro.

  31. Steve Green

    “Chaos in diversity”, again. Surely a matter for the single market as the simple act of payment seems at the root of the single market! There seems no difference in principle between forcing telecoms and internet providers to end intra EU roaming costs from requiring retailers to accept any EU credit or debit card: the proper level of interference in the market in the name of the single market.

  32. T

    @Nanne
    Yeah, NL is great. I like the train ticket machines, too. You can pay with Dutch cards or coins (that includes recharging that OV kaart) – and of course you have to have a ticket in advance, no way around it.

    But maybe that’s just their way to create social interaction between people .o)

  33. nanne

    Electronic cash is not big in Germany. In most restaurants in Berlin it’s impossible to pay even with the EC-Karte. It’s a less service-oriented society in general than the UK or the Nordic countries, you’ll also start noticing this in other ways. You can still get by without being irritated after a while, though.

    P.S. There are some supermarkets (Kaisers, Edeka) that in most stores accept credit cards, which is at least better than the Netherlands, where you can only pay with the national PIN system at the supermarket.

  34. Gerd Kamp

    We’ll the opposite is also true: I’m not able to buy in the states with an EC-card. My bank recently switched from Maestro to Vpay on their EC-card. Much more convenient now in the US.

    And it is much easier to open a bank account in Germany than e.g in the UK. Practically everyone has a “Girokonto” .

    What is really an ancient form of payment is writing cheques. These are practically extinct in Germany but still very much alive in the US

  35. Markus

    I’m not from Germany, but from Austria and very surprised that you don’t have a Maestro card nor have the possibility to get one. In Austria almost every holder of a bank account gets one (except maybe children). Also in other central European countries like Italy Maestro is the de facto standard for paying in shops.

    There were some compatibility problems between foreign Maestro cards and German points of sale which had the Maestro logo but accepted only domestic German EC cards. I think those problems have been solved.

  36. T

    Part of it are the fees which are significantly lower then regular credit cards. Especially some discount stores still use the old-fashioned bank draft: You can see that when sometimes you need to sign instead of entering your PIN. Basically they just take your account number/BLZ from the card and accept the risk of ending up with an empty account (and your address, of course, which the bank will hand out thanks to that signature).

    btw, can highly recommend DKB for the account, completely free account with credit card and free worldwide ATM withdrawals – but you’ve probably heard of them already …

  37. nikos

    well credit cards do charge 5% but still the vast majority of people and stores is using it. And it makes crossborder payments easier -especially if in a country that do not have euro yet.

  38. Jon

    Martin – and that implies that even Maestro doesn’t work properly…

  39. Jon

    Christoph – 5% of the total? That’s much more than in the UK… Why so?

  40. Martin Meyer-Gossner

    Well Jon, seems that studies like these seem to be wishful thinking… http://www.thestrategyweb.com/paypal-global-study-will

  41. Christoph Dernbach

    Credit cards charge up to 5 percent of the revenue from the shop, banks for their EC-Karte only 0.3 percent. That’s a real difference.

  42. Martin Holterman

    I’m sorry to disappoint you, but the answer really is Maestro. That’s what it’s there for.

    (Imagine my surprise when I discovered that Transport for London accept Maestro, but only UK Maestro.)