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From the PoV of someone who once co-owned a small business in Germany that accepted card payments: The reason they are "evil" is that they charge the dealer th

From the PoV of someone who once co-owned a small business in Germany that accepted card payments: The reason they are "evil" is that they charge the dealer the by far largest fees. Cache: no fee. EC card: small fee. Credit card: large fee. And of course I can't ask the customer to pay for it, I must have one price for all. It was something like 1% vs. 3% (approximately(!), just to give an idea of magnitude). It's not even any more convenient. Except for a few places like car rentals, where the credit card serves an insurance function (the rental deposit), there is exactly zero reason to point to convenience. Just use an EC card or a bank card that's attached to the major payment processing networks, everybody has one. On the other hand, most credit cards cost a yearly fee of 20-70 Euros or so. The only reason I grudgingly pay for one is because I rent a car occasionally.

fwn 10y ago
That's quite interesting. I rent cars quite frequently with the boring free VISA debit card from my normal checking account. I never knew that there are restrictions on which cards can be used for renting.
- Noseshine 10y ago
  It's not so much a restriction, and it differs from company to company. For example, I rented twice this year - I don't own a car and usually use the train - and the first time they wanted my to enter the PIN for the credit card, which I didn't know. A big hassle, they took (real!) money off of my EC card (which I got back afterwards). The second time I didn't need a PIN (different car rental company), but they helped themselves to almost 800 Euros in alleged damages from my credit card (good thing I had used an online service and opted into the "we pay the deductible", which was 1,000 Euros, on the full insurance I had also selected to get).
  - thesimon 10y ago
    >they took (real!) money off of my EC card Technical limitation of the German debit card scheme, which doesn't support blocking amounts for security, but requires refunds...
thesimon 10y ago
>Cash: no fee Because it just magically transfers from your register to your bank account? :) >It was something like 1% vs. 3% (approximately(!), just to give an idea of magnitude). I know, but by now it is down to 0.9% for most retailers so not accepting credit cards is always an interesting decision. >most credit cards cost a yearly fee of 20-70 Euros or so When you get a card to collect airline miles or get the card from your bank. Most other banks (Advanzia, Barclaycard, LBB) charge nothing for it, but make up by charging high interest rates. Still most have an interest-free period, which can be beneficial for consumers. > zero reason to point to convenience. Regular cards still don't support contactless. Just tapping your card is vastly better than entering your PIN or signing. A lot of retailers in Germany support it.
- Noseshine 10y ago
  > Because it just magically transfers from your register to your bank account? :) No, there is no fee on that transfer. And please don't tell me "but the effort!". Small businesses gladly go through that "effort". Not everybody is Amazon. You just empty the cash register and bring it to the bank. Not exactly dangerous around here either. > Regular cards still don't support contactless That is not exactly something worth mentioning as great "convenience". Even if you find a store where that is used at all, that's like 0.001% of the effort of going shopping.
  - MrFoof 10y ago
    >No, there is no fee on that transfer. And please don't tell me "but the effort!". Small businesses gladly go through that "effort". Well, there usually is a fee. At least here in the US, business bank accounts get cash handling for free up to a certain amount per month. After that you're charged a small fee (as a percentage) on the amount of cash deposited, because the bank sure as hell isn't counting your cash for free.
    - egeozcan 10y ago
      > the bank sure as hell isn't counting your cash for free I thought there is a machine for that? Also, isn't it possible just to use an ATM?
SyneRyder 10y ago
That's really intriguing. The fees you're describing are the same in Australia (2.9% on AmEx) and don't seem particularly evil at all. A few stores do charge a credit card surcharge here, but the majority of retailers don't anymore. As a near-annual visitor to Germany, it drives me nuts that I can't use my Australian credit card everywhere (especially at Saturn). I would LOVE to have an EC card, but it seems there's no way easy way for a visitor to Germany to get one. Seems you need a bank account, and there doesn't seem to be a way to get one without a residency permit. It's not like Australia where a visitor can at least buy a pre-paid reloadable Visa Debit card in any post office. [If I'm wrong about the EC Cards and bank accounts, please let me know, I'd love to use an EC Card like a proper German whenever I visit.]
- filmor 10y ago
  Since last year Saturn and MediaMarkt (basically the same company) apparently allow payments via Visa or MasterCard ;)
  - SyneRyder 10y ago
    Oh awesome! I didn't get to visit Germany this year so I missed that news... this will make stocking up on my Rammstein / Oomph / Unheilig CDs so much easier next time :D
  - monksy 10y ago
    Oh wow that's a huge deal. I remember seeing posts on ToyTown about people buying washers/driers with cash because CC wasn't accepted.
- Scarblac 10y ago
  In the Netherlands it's something like 2.8% for credit cards and a ~0.05 euro flat fee per transaction for EC cards. Huge difference.
  - thesimon 10y ago
    For the average German retailer it's around: 0.23% EC 0.5% Maestro/VPay/MasterCard Debit/Visa Debit 0.8% MasterCard Credit/Visa Credit 2.5% Amex But of course that depends on the size and the negotiation skills of the retailer. I'm always envy when visiting the Netherlands, "PINNEN ja graag" signs everywhere :)
prefect42 10y ago
I think, in the US, the credit card "tax" is even higher for new businesses. As much as 6% I've been told. (Nice if someone could verify). You can use PayPal instead, they take a smaller cut, still 2%.

fwn 10y ago

That's quite interesting. I rent cars quite frequently with the boring free VISA debit card from my normal checking account. I never knew that there are restrictions on which cards can be used for renting.

Noseshine 10y ago
It's not so much a restriction, and it differs from company to company. For example, I rented twice this year - I don't own a car and usually use the train - and the first time they wanted my to enter the PIN for the credit card, which I didn't know. A big hassle, they took (real!) money off of my EC card (which I got back afterwards). The second time I didn't need a PIN (different car rental company), but they helped themselves to almost 800 Euros in alleged damages from my credit card (good thing I had used an online service and opted into the "we pay the deductible", which was 1,000 Euros, on the full insurance I had also selected to get).
- thesimon 10y ago
  >they took (real!) money off of my EC card Technical limitation of the German debit card scheme, which doesn't support blocking amounts for security, but requires refunds...

thesimon 10y ago

>Cash: no fee Because it just magically transfers from your register to your bank account? :) >It was something like 1% vs. 3% (approximately(!), just to give an idea of magnitude). I know, but by now it is down to 0.9% for most retailers so not accepting credit cards is always an interesting decision. >most credit cards cost a yearly fee of 20-70 Euros or so When you get a card to collect airline miles or get the card from your bank. Most other banks (Advanzia, Barclaycard, LBB) charge nothing for it, but make up by charging high interest rates. Still most have an interest-free period, which can be beneficial for consumers. > zero reason to point to convenience. Regular cards still don't support contactless. Just tapping your card is vastly better than entering your PIN or signing. A lot of retailers in Germany support it.

Noseshine 10y ago
> Because it just magically transfers from your register to your bank account? :) No, there is no fee on that transfer. And please don't tell me "but the effort!". Small businesses gladly go through that "effort". Not everybody is Amazon. You just empty the cash register and bring it to the bank. Not exactly dangerous around here either. > Regular cards still don't support contactless That is not exactly something worth mentioning as great "convenience". Even if you find a store where that is used at all, that's like 0.001% of the effort of going shopping.
- MrFoof 10y ago
  >No, there is no fee on that transfer. And please don't tell me "but the effort!". Small businesses gladly go through that "effort". Well, there usually is a fee. At least here in the US, business bank accounts get cash handling for free up to a certain amount per month. After that you're charged a small fee (as a percentage) on the amount of cash deposited, because the bank sure as hell isn't counting your cash for free.
  - egeozcan 10y ago
    > the bank sure as hell isn't counting your cash for free I thought there is a machine for that? Also, isn't it possible just to use an ATM?

SyneRyder 10y ago

That's really intriguing. The fees you're describing are the same in Australia (2.9% on AmEx) and don't seem particularly evil at all. A few stores do charge a credit card surcharge here, but the majority of retailers don't anymore. As a near-annual visitor to Germany, it drives me nuts that I can't use my Australian credit card everywhere (especially at Saturn). I would LOVE to have an EC card, but it seems there's no way easy way for a visitor to Germany to get one. Seems you need a bank account, and there doesn't seem to be a way to get one without a residency permit. It's not like Australia where a visitor can at least buy a pre-paid reloadable Visa Debit card in any post office. [If I'm wrong about the EC Cards and bank accounts, please let me know, I'd love to use an EC Card like a proper German whenever I visit.]

filmor 10y ago
Since last year Saturn and MediaMarkt (basically the same company) apparently allow payments via Visa or MasterCard ;)
- SyneRyder 10y ago
  Oh awesome! I didn't get to visit Germany this year so I missed that news... this will make stocking up on my Rammstein / Oomph / Unheilig CDs so much easier next time :D
- monksy 10y ago
  Oh wow that's a huge deal. I remember seeing posts on ToyTown about people buying washers/driers with cash because CC wasn't accepted.
Scarblac 10y ago
In the Netherlands it's something like 2.8% for credit cards and a ~0.05 euro flat fee per transaction for EC cards. Huge difference.
- thesimon 10y ago
  For the average German retailer it's around: 0.23% EC 0.5% Maestro/VPay/MasterCard Debit/Visa Debit 0.8% MasterCard Credit/Visa Credit 2.5% Amex But of course that depends on the size and the negotiation skills of the retailer. I'm always envy when visiting the Netherlands, "PINNEN ja graag" signs everywhere :)

prefect42 10y ago

I think, in the US, the credit card "tax" is even higher for new businesses. As much as 6% I've been told. (Nice if someone could verify). You can use PayPal instead, they take a smaller cut, still 2%.