Germany
With 82.9 million inhabitants with high purchasing power (GDP per capita of USD 50 862 in 2021), Germany is the fourth largest economy in the world, the largest market in the EU and a major exporter and importer (it ranks 3rd in the world in both flows). It is one of the most advanced and developed economies in the world, highly innovative and export- oriented. Industry's 30% contribution to GDP is considered high, confirming that manufacturing industry and related services are at the heart of the German economy, especially the automotive, chemicals, machinery and equipment, electronics and ICT sectors. Due to the severe effects caused by the pandemic, GDP contracted by 4.9% in 2020, recovering by 2.9% in 2021. The latest projections by the Economist Intelligence Unit (EIU) for 2022 point to an increase in economic activity of only 2.5% (down 0.7 percentage points from the March forecast), following the conflict in Ukraine and its implications, particularly in terms of higher prices for energy and other commodities, as well as the disruption of supply chains.
Germany business opportunitires
Germany present business opportunities in different areas, both in more traditional ones (namely clothing with quality and design, textiles, footwear, home, agri-food and wines) and in cutting-edge industrial sectors (capital goods, automotive components, ICT, health, environment, among others).Imports from Germany registered a value of USD 1.423 billion in 2021 (USD 1.173 billion in 2020). The five main import product groups were Machinery and Appliances (25.1% of the total), Chemicals (12.5% of the total), Vehicles and Other Transport Material (10.9% of the total), Mineral Fuels (9.0% of the total) and Common Metals (8.4% of the total). Germany's exports recorded a value of USD 1,631 billion in 2021 (USD 1,386 billion in 2020). The top five exported product groups were Machinery and Appliances (27.4% of the total), Vehicles and Other Transport Material (17.5% of the total), Chemicals (14.9% of the total), Base Metals (7.8% of the total) and Plastics and Rubber (5.6% of the total).
Top banks
Germany’s three large commercial retail banks (Deutsche Bank, Commerzbank, and HypoVereinsbank) together only control about 15 percent of the retail banking market. The 403 non-profit independent Sparkassen, or savings banks, most owned by local municipalities all across Germany, had a 37 percent share of the retail market in 2016, and a 28 percent market share in local business lending. Germany also has 970 co-operative banks (Raiffeisenbanken, Volksbanken, under DZ Bank AG), a group that forms the second largest banking segment, with a retail marketshare of around 27 percent.Germany’s “three-column” banking system (1. commercial banks, 2. Sparkassen, 3. Raiffeisen/Volksbanken) is now facing several challenges. The number of bank branches continues to drop. But Germany still has a higher number of bank branches per population than most other European nations. A growing banking segment in Germany is made up of the so-called Direktbanken (direct banks, fintechs) that have no branches and offer lower cost banking only online and/or via a smartphone app or a regular telephone. Examples include Comdirect, DKB Cash, 1822direkt, N26, O2 Banking, and netbank.
Deutsche Bank
Home to several of the most important banks in Europe. Two UK based banks - HSBC and Lloyds Banking Group – are not only the largest banks in the country, but also a market capitalization above 30 billion U.S. dollars, while the largest - HSBC - is the largest bank in Europe with a market capitalization of over 124 billion U.S. dollars. In addition, UK based banks Lloyds and NatWest rank as the 10th and 14th largest in Europe. Other large and well-known banks in the United Kingdom are Barclays and Standard Chartered, even though they do not rank among the top players in Europe.
DZ Bank AG
DZ Bank AG (Frankfurt a.M., 595 billion). Our deep roots in the cooperative group allow us to face future challenges locally and globally with enduring values. We don't just strive to be among the world's best-rated financial institutions; we make our clients' ambitions our own and bring our attitude to the table: We think and act in a partnership-oriented, consistent, innovative, courageous, cosmopolitan, capable, safe, and sustainable manner. This attitude guides us as a bank and, especially in these challenging times, is what makes our success.
KfW Group
KfW Group* (Frankfurt a.M., 546 billion). KfW is the promotional bank of the Federal Republic of Germany. This promotional mandate is set out in the "KfW Law". The transformation of the economy and society to improve economic, ecological and social living conditions worldwide is KfW's primary objective.
Commerzbank
Commerzbank (Frankfurt a.M., 507 billion). Tailored and efficient solutions oriented on your individual requirements and targets – that’s the claim Commerzbank makes as your partner. Understanding client requirements, sector and market competence as well as reliability and fairness are at the centre of our philosophy.
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HypoVereinsbank
HypoVereinsbank (UniCredit SpA, Italy) (Munich, 338 billion). HypoVereinsbank is part of UniCredit, a pan-European Commercial Bank with a unique service offering in Italy, Germany, Central and Eastern Europe. Our purpose is to empower communities to progress, delivering the best-in-class for all stakeholders, unlocking the potential of our clients and our people across Europe. We serve over 15 million customers worldwide. They are at the heart of what we do in all our markets. UniCredit is organized in four core regions and two product factories, Corporate and Individual Solutions. This allows us to be close to our clients and use the scale of the entire Group for developing and offering the best products across all our markets.
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Landesbank Baden-Württemberg
Landesbank Baden-Württemberg (Stuttgart, 276.4 billion). With deep roots in Baden-Württemberg, LBBW is also present in a number of economic and financial hubs worldwide. We place our expertise at our customers' disposal – and are just as involved and innovative as they are. Because we think and act like an entrepreneur. LBBW provides its services as a mid-sized universal bank to companies, retail and institutional customers and savings banks. As an institution under public law, LBBW is owned by the Federal State of Baden-Württemberg, the Savings Bank Association of Baden-Württemberg and the City of Stuttgart.
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Bayerische Landesbank
The bank is the exclusive service provider for the Bavarian savings banks in the field of subsidized loans. It also plays a leading role across the German market in the foreign notes and coins/precious metals business.
Landesbank Hessen-Thüringen
Landesbank Hessen-Thüringen (Helaba) (Frankfurt a.M., Erfurt, 219.3 billion). The Helaba Group - more than 6000 people at 18 locations in Germany and around the world. We help our customers achieve their goals, both nationally and globally. As a reliable commercial bank, a central bank and partner for the German Sparkassen as well as a committed regional development bank.
NRW.BANK
NRW.BANK (Düsseldorf, Münster, 155.8 billion). In its capacity as the promotional bank for North Rhine-Westphalia, NRW.BANK supports the federal state in the completion of its structural and economic policy tasks. The Bank acts on behalf of the public sector in a competition-neutral manner and uses the full range of promotional products – from classic loans to customised advice. Its three promotional fields are “Economy”, “Housing” and “Infrastructure/Municipalities”. Sustainability is a central guiding principle in this context. NRW.BANK promotes the necessary transformation of North Rhine-Westphalia towards a low-emission and climate-smart economy. In contrast to commercial banks, NRW.BANK’s customers are mostly house banks and other promotional intermediaries. In the relationship to other banks, NRW.BANK strictly respects the principle of non-discrimination. Its cooperation with the cooperative and private banks as well as the savings banks follows the house bank principle in a competition-neutral manner.
Norddeutsche Landesbank
Norddeutsche Landesbank (NORD/LB) is a commercial bank that provides a range of banking and financial solutions. Its core business includes structured finance in the energy and infrastructure sector, ship and aircraft finance, commercial real estate finance, capital markets services, and private and commercial banking.
Top payment methods
Germans are among the most open to international shopping consumers in the world, with over 50% of online purchases made on foreign websites. Despite this willingness, the country is also one of the most fragmented markets when it comes to payment methods. Credit cards, such as SEPA direct debit, SOFORT and Giropay, account for the majority of online transactions. In retail (specifically in the fashion market), another popular payment method is open invoice, where a third party company pays for products and services and collects payment from the buyer after delivery.
Perhaps due to the preference of Germans who are more reticent to keep physical control over their spending, cash remains popular, although the girocard payment method is almost ubiquitous, with 68 million users. In light of covid-19, 45% of contactless payments are made using this local method, with many retailers, large and small, implementing girocard payments to encourage contactless payments. Source: Statista – Share of online stores that offer the main payment methods in Germany in 2020
Klarna
Klarna is a popular Buy Now Pay Later payment method available in 19 countries.With Klarna, the shopper can choose to:> Pay later: Pay after the goods have been delivered.> Pay over time: Pay in installments over time.> Pay now: Pay the whole amount instantly, either by onlinebanking or direct debit.Before approving the payment, Klarna performs risk checks on the shopper. If successful, Klarna takes on the full fraud risk for the payment, and pays you up front.Sofort is a popular online banking method in Europe. It allows shoppers to use their own online banking details to make a payment. Sofort is also known as direct E-banking and was acquired by Klarna. There are some differences between Sofort and Klarna Pay Now: Klarna Pay Now offers direct debit and online banking. This is a guaranteed setup, meaning Klarna takes the risk on these payments. This comes with a higher fee.Sofort offers online banking and a lower fee. However, Sofort chargebacks are at your own risk and you cannot defend against them.Ratepay provides buy now, pay later (Open invoice) and secured direct debit 1 payments in Austria, Germany, the Netherlands, and Switzerland. Before approving the payment, Ratepay performs risk checks on the shopper. If successful, Ratepay takes on the full fraud risk for the payment, and pays you up front. If the shopperchooses to pay with Buy Now Pay Later, Ratepay pays you as soon as you capture the payment.
Paypal
Paypal is one of the market leaders in online payment solutions with more than 400 million active customers worldwide, available in 200 countries and in more than 100 different currencies. As faras online shopping payment is concerned, it is the one of the mostused payment method in France.
Visa
Visa is the world's largest global card network by transaction value, ubiquitous worldwide. Visa positions itself as "the best way to pay and get paid by everyone".
Maestro
Maestro is a debit product within the Mastercard offering. Maestrocards can be used for payments in stores and to withdraw cash fromATMs. This payment method requires electronic online authorizationfor almost all transactions, although Mastercard's rules allowminimum limits to be set only for Maestro EMV chip transactions.
SEPA
SEPA (Single Euro Payments Area) Direct Debit was introduced by the European Payments Council to create a standardised payment infrastructure within the EU. With SEPA Direct Debit, businesses can process one-off or recurring payments for EU customers, making it a key payment method for businesses looking to expand across Europe. Founded in Germany in 2013, N26 is the first 100% digital bank to have beengranted a full German banking license from BaFin. The advantage of N26 is that the whole process can be done online, in a few minutes, without the need for proof of income to open the account. However, it is necessary to have proof of address in one of the countries where it operates, a valid passport, and a European residence card valid for one year.
Concluding remarks
In Germany, there are several payment methods available, including:
Cash
Cash (Barzahlung) – It is still common in Germany to pay cash in stores, restaurants and other establishments.
Bank transafer
Bank transfer (Überweisung) – Bank transfers are common in Germany and many stores accept this payment method. However, the transfer can take a few days to complete.
Debit Cards
Debit card (EC-Karte) – The debit card is widely accepted throughout Germany. It is linked to a bank account and the amount of the purchase is deducted directly from the account.
Credit card
Credit card (Kreditkarte) – Credit cards are accepted in many stores, restaurants and hotels in Germany, but are not as common as in other countries. Some establishments may charge an extra fee for credit card payments.
PayPal
PayPal – PayPal is a popular option for online shopping in Germany. Users can link their bank account or credit card to their PayPal account to facilitate online payments.
Apple Pay and Google Pay
Apple Pay and Google Pay – These mobile payment methods are becoming increasingly popular in Germany, allowing users to pay with their smartphones at establishments that accept these options.
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