Hacker News Reader

Comment by mtmail | Hacker News Reader

According to https://www.cashforless.de/ec_cash_info/Fakten_zur_Kartenzah... methods for payments in stores 2011 was 57% cash, 5.3% credit card, 33% debit card (https://en.wikipedia.org/wiki/Electronic_cash).

> "of course, [the Germans] attitudes toward currency must owe something to Germany’s tumultuous monetary history. During the Weimar-era hyperinflation that peaked in 1923 [...]"

> "the German tendency to settle up in cash undeniably reflects the fact that for much of the last century, Germany has been either on the brink of, in the midst of, or struggling to recover from, disaster."

As a German I call that theory into question. Our currency has been stable for 60+ years. It would've been nice if other countries with recent disasters (war, hyperinflation, sanctions) and their attitude toward currency was compared against.

View on HN

My theory with Germany specifically is that the Germans I have known have all been extremely protective of their privacy. I'd be interested in seeing stats on social media adoption in Germany, because my hypothesis is that they lag the rest of the world.

If privacy is such a concern (and particularly privacy from one's own government), then the use of cash makes sense. My guess is that this distrust of government did grow from the abuses of domestic surveillance by the Nazi regime and East Germany. I'd be curious to see how this breaks down between the old east/west lines as well.

And I'm sure individuals don't use cash for these reasons; but because the system in Germany functions that way out of historical legacy. As a consumer, it's simply easier to buy things with cash.

>I'd be interested in seeing stats on social media adoption in Germany, because my hypothesis is that they lag the rest of the world.

Not only do they lag in general, but I also remember a study which showed that in Germany higher education levels are associated with significantly less social media use, while it's quite the opposite in the rest of the world.

That's true. The fastest growing social network within German universities was an anonymous one. This is opposed to the USA, where Facebook was the fastest growing network based on the ideal of knowing exactly what classes Y person on your campus went to.

Does that social network still exist, and can you share its name please?

Jodel https://jodel-app.com/

I had it installed for a few days once. I decided to uninstall it because it took too much attention (there are MANY users in Berlin) and I kind of felt too old. The typical user is a student in the first few semesters.

Thank you!

As a German

a.) I mostly pay cash because it's faster

b.) some shops that can afford it only have cash payments to save on CC costs

Not because of inflation or because something happend 100y ago.

As a German

a) I don't want to feed the Visa/Mastercard/Amex/Whatever leach earning a few cents of every transaction.

Not German, but I simply don't want to leave my trail of what I am spending and where.

And what of purchases made on websites?

Opt for money order, cheques?

As very few Germans even have credit cards, most Germans pay online (if they don’t use PayPal) via SEPA wire transfer or SEPA ELV. And even PayPal and Amazon support using SEPA ELV to pay for stuff.

Was waiting for this comment. I often ask myself, "Do I want any entity to have a copy of the exact dates and amounts of my entire daily consumer activity?". Whether anonymized or not there is a tremendous amount of knowledge that can be gleaned from non-itemized debit card ledgers.

I also think/thought like that.

But if banks wanted, they could actually track the serial codes on the bills around. And since often cash is used in only 1 hop (so ATM -> you -> shop -> bank) they could know pretty well where you spent your money.

A quick reference: https://news.ycombinator.com/item?id=9948081

E.g. about China: "According to schedule, by late 2015, the serial number of every Rmb100 note withdrawn from banks by members of the public can be traced."

> But if banks wanted, they could actually track the serial codes on the bills around. And since often cash is used in only 1 hop (so ATM -> you -> shop -> bank) they could know pretty well where you spent your money.

That doesn't include how much you spend exactly. And it only works most of the time (what if my money gets used as change for another customer?).

Same here.

Also, been a couple of times in the situation where either the shop's card terminal was malfunctioning, or the bank had some issues, and the card payment was impossible. Without cash you'd be helpless in such a situation, whereas cash = power & independence.

In 4 party schemes, most of the transaction fees don't actually go to Visa/MC.

Handling cash is not free either, it also comes with transaction costs.

But it's money spent on my government and not some American companies. Huge difference IMO

No, the companies pay the cost of handling cash as well.

There's the labor costs of handling cash - counting it, moving it, organizing it, accounting for it, making sure there's enough change to run a shift; the cost of storing and transporting it - safes, cash draws, key management, money transport/money transport companies; and the cost of loss due to theft, mistakes, and mismanagement.

I'm not saying that the cost of cash is more than the cost of card, I'm simply saying its not anywhere near free.

https://qz.com/123642/physical-money-costs-americans-more-th...

>But new research from Tufts University aims to highlight the pain points of cash, where digital currency can break in. The use of physical bills costs US consumers, businesses and the government at least $200 billion each year—about $1,739 per household. Here are the main reasons why:

>Small businesses don’t lose much money by operating cash-only. But larger businesses spend a significant amount of money dealing with cash—collecting it, sorting it and getting it to the bank without it being stolen. US businesses lose $40 billion a year to cash theft and loss, about 1% of total revenues.

http://baltimore.cbslocal.com/2017/02/02/cashless-coffee-sho...

(There's also a potential to increase sales by accepting card.)

Nope.

Yep.

https://qz.com/123642/physical-money-costs-americans-more-th...

>larger businesses spend a significant amount of money dealing with cash—collecting it, sorting it and getting it to the bank without it being stolen. US businesses lose $40 billion a year to cash theft and loss, about 1% of total revenues.

As an american, I find it strange that cash is faster. Most people who pay cash need to wait to get the change back unless they know the total beforehand and happen to have exact change. In the US, credit card machines are very fast even the chip enabled ones.

Cash workflow:

- Cashier tells you the total amount

- You look in your wallet/purse

- You spend time counting exact change if you do have it

- If not, you take out a rounded bill/note (say $20)

- Cashier takes the bill/note, punches in the register and then spends a few seconds giving you the change back.

Credit card workflow:

- Cashier tells you the total amount

- You look in your wallet/purse

- You swipe card/insert in chip reader

- Done

*Credit card workflow: - Cashier tells you the total amount

- You look in your wallet/purse

- You swipe card/insert in chip reader

- You avoid making eye contact while the transaction is processed

- (optional) The card reader fails and requests reinsertion. Repeat previous two steps

- Done

You missed the part when they are in holidays in Europa or Asia and realize that American whatever credit card is usually not accepted and they begin shouting at everyone what kind of third world country this is.

Disclaimer: I've seen exactly this a few times

> Credit card workflow:

> - Cashier tells you the total amount

> - You look in your wallet/purse

> - You swipe card/insert in chip reader

> - Done

You forgot the part where you have to enter you PIN and wait for the transaction to go through, or sign the receipt.

Contactless payments don't need PIN (up to some small but comfortable amount) and go through almost instantly.

But Germans don't trust contactless payment because in theory anybody could hold a card reader against your wallet while you're innocently waiting in some line.

And just what would they do with it?

That seems an easy way to get your merchant account cancelled very, very quickly.

But why would they care? Stripe does payments every 3 days or so and you can easily create more accounts. I never ever checked my credit card history, and I assume many people who only use it as secondary payment system don't. It's easy as fuck therefore IMO a valid scenario.

Without the CVC code, Stripe isn't going to accept the payment.

Even if it did, the bank is likely to block the transaction, or call/text for verification.

> CVC code

I heard that those are very easy to crack. It might have been this article from 2011 where I read about this (German, sorry): http://www.zeit.de/2011/21/Kreditkarten-Sicherheit

Not to mention half of the database leaks in recent years, especially of porn sites, contained them anyway

The defence against that for me is that I have like 6 rfid enabled cards in my wallet, between my Oyster Card, student ID, library card, key card to access my work building, you can't scan any of them without taking it out individually.

I carry two contactless cards: the metro pass and an office key. They are just taped together (because I want to make sure I always have both) and still reliably work, so I doubt you are protected.

I have tried many times to use a single one of them without the other 5 interfering and it has literally never worked.

I tried to use android pay for a few months. In theory its great (and it's great when it works!) but like 30% of the time it doesn't really work the first time, you have to play around with it on the card reader. Then the phone vibrates like it worked but nothing happens. You look at the phone and it says "please hold the card to the reader again." and despite Subway accepting android pay (and the cashiers insisting that it works for everyone else) whenever I try to use it there I get a message "please insert card." I was never able to figure out the workflow to get it to work on a vending machine. Also the first time I used it I froze the register.

So 70% of the time it saves time and 30% of the time it wastes time. Then I broke my phone and bought a replacement without NFC so I don't have the option anymore anyways.

It's a great system, however, I think the kinks need to be worked out a little.

(I had a Nexus 5x FYI)

Contactless debit cards are a lot more reliable than phones, mainly because they have one unique job. My card plays up now and again but that is only since it went through the tumble dryer, which distorted the card and seems to have affected the reliability of the NFC chip, in practice this means I sometimes need to tap twice.

Another difference between American and other systems. Credit cards in US don't have PIN numbers. Only Debit cards have PIN.

Yeah, but you have to sign, which is worse.

They do have PINs, just most people don't know what they are. You can use the PIN to withdraw cash from an ATM at a ridiculous interest rate. I recently was using my credit card in Iceland at a gas pump where I was prompted for a PIN.

That's because, as I was shocked to find out, most POS in the US don't ask for a PIN! Convenient indeed, until someone gets ahold of your card.

Almost all credit cards are 0 liability to the consumer. Even if someone gets a hold of my card, I can call the credit card company and get all fraud charges reversed. That's why I personally always use a credit card EVERYWHERE. I hate cash and I hate to wait in lines. But sure, they have an electronic trail on me which frankly, I don't care too much about. If the Govt wants to get you, they WILL get you.

"Almost all credit cards are 0 liability to the consumer. Even if someone gets a hold of my card, I can call the credit card company and get all fraud charges reversed."

That's true only if you or the credit card company notice the fraudulent transactions and act on them within the limited grace period, which I believe is something like 3 months.

Many people don't actually keep their receipts or reconcile them with their credit card statement. So unless they get an unexpectedly huge credit card bill, they might not even notice that they were victims of fraud and in that case the "0 liability" credit card policies are worthless, because they get defrauded anyway.

Americans are used to entering PINs on debit cards, but not credit. However, in my recent experience in Iceland & Germany, most POS don't ask for a PIN on credit transactions either. The only time I was asked for a PIN on a credit card was at a gas pump.

That however is because of your American card and not the POS systems usually not asking.

I have to verify any transaction over 20$ with my Swiss credit card for example. Even on contactless

This isn't shocking if you understand the different legal context around credit cards in the US.

Historically if in the US if someone gets a hold of your card, if I report it as soon as I know there is a problem you are legally out $50, and the credit card company and merchant has to eat the rest of the loss. In most cases the credit card companies figure since they have to take the rest of the loss they may as well get the customer service points by taking that $50 as well. As such it is only a minor inconvenience if someone gets a hold of your card, most of which is related to waiting for them to mail you a new one. Because of this people don't care about chip and pin being more secure: security was not their problem. This is also a factor in why the US is much more likely to use a credit card: there are no anecdotes about someone losing a lot of money because of their card.

By contrast in Europe you were liable for all amounts charged on your card before you report it, even if you had no way to know about the charge. Since the credit card companies didn't have to take a large risk they typically didn't agree to take it on. As such a credit card is much riskier, and so it is prudent to not use your cards if you have a different option. When chip and pin came out consumers were interested because it gave them some ability to limit their loss: their chip/pin card could be lost without the potential of great loss.

Note that the above is historical, and like all generalizations is false in some way. Laws change all the time which means the current reality is probably different - but the historical reality is still shaping our world. Europe is not a country, each country in Europe always had their own laws which differed in some way from the next.

You commonly don't have to do that for small transactions in your usual country.

In america prices are always cent-specific (2.85, 3.78). Berlin, much like Argentina (cash strong markets) have rounded prices for everything, its actually much faster. What ist errible is the waste of time going to an atm frequently, or handling lots of petty coins or bills.

Cards are definitely more convenient.

In Germany the price advertised is the price paid. Not so in America due to taxes and fees.

One thing I like about Square from an independent merchant standpoint is that I can mark that an item's price should be considered to include all relevant taxes & fees. This allows for listing prices in round increments. This is more helpful for cash transactions because most people only cary bills so I mostly only have bills to hand back as change. It is easier for me to deal in whole dollar or at least quarter increments so I never have to worry about pennies, nickels or dimes. For cards, I can charge arbitrary amounts and it doesn't affect me or the customer at all. Granted, you have to do a little math up front for each item to ensure you're getting the right profit per sale, but it's negligible to the amount saved by not having to count change.

Germany has the VAT, they just require that vendors hide it from the consumer.

"Hide" as in "the calculation is done in multiple lines on each receipt with the amount of VAT clearly spelled out"? Germany has some hidden taxes in the supermarket (on alcohol, tobacco, and coffee) but VAT is absolutely visible.

VAT is part of the itemized receipt. More importantly, as the parent says, advertised prices must include VAT. This is different from the US, where sales tax is added as a last step, and advertised prices are always excluding tax.

> Berlin...have rounded prices for everything

That's rarely the case. I can only think of dm (a drugstore) which rounds all prices in 5 cent increments. Otherwise you see a lot of prices ending in 8 or 9.

Yes, dm's prices are great. That's one of the reasons why I prefer it over Rossmann and Müller.

Also, there are several chains (Netto, Rewe, Kaufland, etc.) where you can round up your total to the next-higher multiple of 10 cents, and the difference goes to charity. I always use that if possible to avoid Buntmetall (i.e., 1/2 cent coins).

Cards used to be more convenient in the US. But once they started putting in the chips the verification process takes ages. I can complete the whole transaction in cash in the time it takes the chip reader to get itself sorted.

In a German supermarket there are two notable differences:

People pay with rounded bills most of the time, cashiers are fast at returning change (amounts are usually a single cent below the full euro for each item, so change isn't a big problem).

The credit card workflow requires you to sign as well (or alternatively sometimes your pin if it's a debit card). Also, no swiping, only chip readers.

So in essence, taking out the bills is comparable to taking out your card, and the question is whether signing/entering pin is faster than the cashier giving you your change.

Of course occasionally you will pay in exact change, but that's balanced out by all the times you have to insert your card a second time, followed by trying another card.

Say hello to contactless https://www.visa.co.uk/products/visa-contactless/

Standard on most bank cards in the UK. No pin or anything. Tap it on the machine and you go. Takes 2 seconds at most.

Still, I do hold cash sometimes, you do need it in some cases.

I'm sure I've used this in Germany many times at Lidl and other supermarkets.

NFC payment has been rolling out more and more over the past couple years. Edeka is probably the biggest exception, I'm waiting very impatiently for them to catch up.

Edeka is (despite its appearance) not a chain but just a common brand used by lots of independent merchants without many rules[0]. Some Edeka stores therefore introduced contactless payments years ago, some never will. Best is to talk to the owner (they usually just have one or a few stores) – I have been successful with "mine".

[0]: In contrast to e.g. Rewe which is also mostly operated by independent merchants but has strict rules for those.

Further to this, I've actually found in Canada I use Android Pay more and more often now that it's available. The whole country is shifting to contactless and it's incredibly useful to just be able to pull out my phone and make a purchase.

It's faster, and the app gives a list of the purchases you've made with a card, so I can track what I'm spending relatively easily. Unfortunately, there are still lots of stores that haven't upgraded to contactless yet, which means I can't rely on Android pay for the time being. I can see this being much worse in Europe where contactless payments aren't implemented in many more places than here in Canada.

It's super fun and easy. But

A) there is a risk as everyone can create a stripe account and buy a charger. Personally I would never notice.

B) every transaction creates costs. Some visible (depit charging fee) some hidden (credit transaction fee)

C) At least in most of Europe it is far from widely supported, even thought it's growing for a while now. Except you stick to the most touristy places that is. In south east Asia I haven't seen it at all except in tourist focused places.

> A) there is a risk as everyone can create a stripe account and buy a charger. Personally I would never notice.

Personally, the convenience of: not having to wear a wallet at all (I just carry the card in my pocket) and not having to deal with coins, negotiate if I'm paying a big bill etc. is just amazing. Even if someone steals $10 from me once in a blue moon, it's well worth it.

For me it's a different world anyway. Currently I carry about $300 in 4 currencies, a debit card and a credit card. I travel a lot and without a stack like this I would have been stuck many times.

The credit card never really saved me. It really just is there to make life a little easier.

I just got back from a four-country trip (3 currencies) and having a credit card was very useful for hotels and car rental places that want to "pre-authorize" charges (often 250 EUR or more).

When I tried using my debit card and they ended up taking the money and then refunding it over a week later.

Good point. I don't drive car but in western countries I basically had to pay the bikes worth as deposit because I didn't carry a credit card. Plus this was seen as super unusual (even having a this high euro amount on hand was seen as suspect)

I can't even count the number of times I've been stuck behind someone in Rewe, waiting while they scrounge around in their purse or wallet for those final few cents. It is far from uncommon, at least where I live.

You're right about the cashiers though, they're super quick.

The good thing about the card is that you hand it over, and while the reader is talking to the bank you have a few seconds to continue packing your bags. I've simply found it flows better with card every time, as long as you remember which checkout has the dicky card reader that needs 3 tries.

I've never lived in Germany, only visited as a tourist a few times to several different cities.

I've never had to sign in the last couple of years when using my credit card. Fewer smaller shops would take it than in the UK, but otherwise I never noticed any difference.

It comes down to the card, not store. Many German cards require you to sign (actually stores bypass the card entirely and just use it to read your account number and make you sign a SEPA direct debit mandate).

Plus, when paying by card even if you dont want a receipt you need to wait for the merchant receipt to be printed out before the transaction is complete. With cash if you dont need the receipt and pay the correct sum you can be on your toes.

New CC cards with chip e.g. Visa/DKB have also PINs without being a debit card.

You actually have support for contactless and thusly Apple Pay in a load of places in Berlin, people just don't know about it. The look of shock on the clerk's face when I insisted that yes, I can pay by waving my phone.

Parting with your money shouldn't be easy :)

I find the workflow with the new chip cards much less convenient to the point that I'm starting to prefer cash or Android Pay if it's available. Even though I lose the 2% cashback bribe.

Which card is that, that takes away the incentive? I use Apple Pay pretty frequently and still get my cashback rate, or double points incentives on the cards that I use.

Among others the Citi Double Cash, earned in 2 steps:

1% earned when spending

1% earned when paying the bill

Cashback is not immediately applied to the balance so it's actually 2% and not something like 1.9999999. No annual fee but it's not really worth it to apply for this card per se, better to get another card that comes with a signup bonus (this one never does) and "product change" it to this card by calling in.

You're right, I worded that poorly. I meant only for when I pay with cash I lose the 2%.

Not only that, but you also have to either carry your small coins around so you can use them up or you have to collect them and then redeem them all for bills or deposit them. This is a royal pain. I have so much change lying around the house that I haven't bothered to count and redeem.

On the other hand, if you use credit cards, you would ideally be keeping receipts and then reconciling them to the statements you get from your credit card company to make sure there's no fraud and no errors in billing. Some people have the discipline to do that, but many don't.

With credit cards it's easier to overspend. Not only can you perhaps too easily borrow more than you have in the bank with a credit card, but temporarily giving someone a card that you get back right away or giving them a credit card number doesn't have the same psychological impact as permanently and irrevocably giving someone your hard-earned cash. So people are tempted to spend more when using credit cards.

Finally, there's the issue of being tracked. When you use credit, at the very least the credit card company knows where and when you shop and possibly what you buy. With cash you could have more privacy in this respect.

Every evening I put all spare change from my trouser pockets into a large glass jar next to the door. Once a year I reedem the money and have a really nice dinner.

Do you count the change before you redeem it? That is a huge time-suck for me, and I hate doing it.

Also, I feel really bad for the cashiers that are unlucky enough to have all that change dumped on them and are forced to count it all. Some banks have change counting machines, but surprisingly, many don't and the change is still counted by hand while you wait.

If you get bags for change (like shops use) and split everything by denomination and amount it makes it a little easier.

Are you serious? If you take it to the bank, they have change counting machines. Depending on how much you bring in, it takes about 1-5 minutes for the machine to count. In the US we have a company called CoinStar that has kiosks in every major grocery store chain which does the same thing. They take a small percentage, but we're talking about coins here, so it's probably less than a dollar per transaction.

I've taken change to banks that didn't have change counting machines. The tellers counted the change by hand. I was shocked.

CoinStar’s fee is 11.9%, according to their website[1] - I wouldn’t call that small.

[1] http://www.coinstar.com/HelpCenter

Not small by percentage, but the cost for the time saved is small. Might cost you $15 to save 2 hours or more.

Of course, just take it to the bank and they'll do it for you for free.

ha .. same here .. once a year on 'weltspartag' i gift this money to the kids and they split it up.

also i use it to get some change for the occasional buns

Cash workflow:

- Cashier tells you the total amount

- I get a 10 EUR note from my trouser pocket

- Cashier gives back money

- I put money in trouser pocket

- Done

- Home: I put all spare money in a large glass jar

Credit card workflow:

- Cashier tells you the total amount

- You look in your wallet/purse

- You swipe card/insert in chip reader

- You insert PIN number

- You shield your PIN entrie from the people next to you

- You tell people too close to back off

- Chip reader did not work because of humidity

- You insert PIN again

- You tolerate the angry stares from people behind you who think you're either stupid or broke

- You wait 5 sec for transaction to fish

- You put card back in wallet

- You put wallet back in trouser pocket

- Done

Credit cards don't require a PIN. Just get a credit card and pay it off every month. Free points!

America has much higher "rewards" than anywhere else. The reward money comes straight out of merchant fees.

Exactly. I'll continue to use my card whenever possible to save at least 2% on every transaction. But this comes at the cost of getting my CC data stolen from shitty POSs 1-2 times a year. Small inconvenience, but worth it.

The merchant fees do fund a substantial portion of the rewards programs for cards.

However, there's a pretty large market for credit/debit card transaction data. Even Google purchases it[1]. Both your credit card company and the payment processors/networks themselves are able to monetize this data quite effectively. And the more complete people's transaction histories get the more effective this data becomes for different uses and the more the companies can charge for it.

Depending on the demographic a particular card is able to capture, the transaction history may be valuable enough to run the rewards program at a loss or break even when looked at purely from the merchant fees recouped.

[1] https://www.washingtonpost.com/news/the-switch/wp/2017/05/23...

I think that only applies to the US. My credit card has a PIN. You don't need it for contactless payments but they are limited to €30.

In India all credit card transactions need a PIN after the card is swiped.

Chip cards in most places in the world require a PIN. It's only the US where (I've ever seen) chip-and-signature (which is a horrible and flawed implementation).

Australia: Tap for anything under $100, no PIN, choose whether or not you want a receipt, done.

In Germany credit cards are very uncommon. We use debit cards, many places don't accept credit cards (but debit cards), some places accept only cash. Paying with a credit card also has a fee while paying by cash or debit cards is free.

Note for the American readers:

in the glorious lands across the ocean, chip cards of all kinds use a PIN instead of a signature, which makes way more sense anyway. Chip & sign is an American abomination.

Is this something that only triggers above a certain threshold? On the east coast, whenever I go to the grocery store, its just insert chip and press ok. I've never had to sign or enter a pin.

No, everywhere else in the world (basically) it's chip-and-PIN. In the US, it seems to be chip-and-signature (which defeats one of the biggest benefits of chip cards).

When I was in Seattle at a restaurant trying to pay, the owner told me that they also couldn't accept tips if they used chip cards. I thought she was BSing me into paying cash but she tried to swipe the card instead so that I could.

It's amazing how, in the US, even the implementation of new technologies is broken and awful.

This is called "expedited checkout". This is a merchant option to help speed up the checkout process. However the merchant is then taking all responsibility for fraudulent transactions.

Many US-based stores only bother with a signature for amounts over a certain threshold (often $50).

I've seen it typically trigger above $50 at grocery stores in the US.

I always just scribble or write celebrity names, since there's no security benefit to a signature.

In the US, the credit card security comes from the vantage of "it's quite literally.... not your money". If there are any failures in security, the bank pays, thus ease of use is of greatest concern to the consumer.

In the USA, its rare that you'd have to sign for anything under $20.

I think maybe this is a cultural thing. In Europe it seems people associate "credit" with "being in debt" which of course isn't (necessarily) true. It just means someone else is on the line until you reconcile, and this is the beauty of credit cards – they make it tremendously easy to safeguard your own money. Just make sure to pay off the bill at the end of the month and everything is solid.

Because of this, credit cards in Europe tend to not have the same great benefits you can find on cards in the US. AMEX is pretty good still, but there isn't exactly tons of competition in the credit card space here.

I love signature, because I play the credit card sign up game. Hard to remember PINs when you open a card a month.

Also because if my card gets stolen, I'm assured that my pin wasn't lifted by camera or keypad shim. The signature will be not present or not mine on fraudulent transactions, so I can tell my card issuer to fix it and not worry about them telling me I had "poor PIN security" or that it was somehow my fault.

As a non-american I have to ask: why sign up for new credit cards all the time?

Because credit card companies offer incentives to sign up for their cards. A lot of people here regularly carry a lot of debt on their cards, and the credit card companies know if they give those users more cards to juggle around their debt on, they can leach more money from them.

For financially responsible people, that means you can sometimes get a few freebees if you're willing to deal with the hassle.

I don't know what it's like in most other places, but debt is a weird part of culture here.

I'm British, and while some people have credit cards, most people I know don't. I have a bank debit card and I use the single card to pay for pretty much everything I don't pay for directly with cash. I have zero debt, because I always pay up front for everything.

I do get lots of junk mail for credit cards, have done for decades, so I could get one tomorrow if I desired. But I don't see any real value in doing so; why get into debt if you can avoid it.

I use a (n.b. singular, not multiple) credit card from AMEX for the benefits. (Particularly excellent travel insurance and car rental benefits.) I make sure to never spend more than I can pay off at the end of the month, so that I don't actually ever get into debt. My own money is resting nicely in a bank account until the credit card bill arrives.

I never spend my own money directly unless I have to (e.g. the merchant doesn't accept AMEX or only takes cash etc.) because should I end up with fraudulent transactions or lose my card or whatever it may be, I have actual cash to back it up.

If you're fiscally responsible and make sure to always pay off the bill at the end of the month (with all that money you didn't spend) then credit cards are pretty much nothing but benefit. There may be a yearly fee associated (my card has one) with it but I've found it to be worth it for the benefits alone, but I also rack up so many points that I can use those to pay for the fee.

I used to agree regarding pin vs sign, until reading on here today how much slower European systems seem to be.

Note for the European readers:

You can call your bank, get your card switched over to Freedom™ mode and enjoy faster payments.

Might not want to do this with a debit however.

I have a credit card from Luxembourg that is somehow set up to ask for signature, even though it can do PIN just fine, and I really don't recommend this setting in Europe, it's a massive pain in the ass since most merchants aren't equipped to deal with that. You end up having to sign the merchant's receipt with a pen like you're back in 1970, it takes a lot more time than entering your PIN (or better yet, contactless without PIN these days).

(And I did complain to their customer service, but they won't change the setting).

Depends on the country, in many EU countries I find chip+sign payments to be way faster than chip+PIN. Every now and then you run into a cashier that gets confused by chip+sign, but not often enough to justify switching back to chip+PIN in my experience.

In Canada:

- Cashier asks if I'm paying with a credit or debit card.

- Cashier enters the total amount into POS terminal. Meanwhile I pull my card from wallet.

- I tap the terminal with my CC.

- I put my card back into wallet. Meanwhile the cashier asks if I need the receipt.

- Optionally: take the receipt.

- Done.

Cash Workflow:

- Cashier gives you the total - I pull out the bills I have and find the best denomination - I get a bunch of change back I have to stuff into my pocket along with my bills while getting my stuff out of the way for the next person

Credit card workflow: - Cashier tells you the total - You say "debit" or "credit" and the cashier pushes a button on the register - You pull out your credit card, touch it to the machine, and then put it away and start packing up your stuff to leave - The machine beeps and you leave

Far less fuss, far less opportunity for dropping change. Simple and efficient. I have my card out, tapped, and back within 5 seconds and my transaction is complete, and I never have to worry about if I have enough or too much.

But you left out the step of having to get the cash money into your pocket to begin with. I haven't touched cash in many years, but back when I did use cash it was always a pain having to go to the bank, or an ATM, or remembering to ask for money back once debit cards became a thing.

funnily I often get my cash when buying groceries.

I pay with my banks card (not a credit but a debit card) and then ask them for cash on top of the groceries. I am often the only one paying with a card if any kind though.

that way i have cash for all the things were paying with a card is frowned upon in germany:

- eating out - going on a fair - getting ice cream with the kids - going to the public pool with the kids - giving kids their allowance :)

and other things of that nature

PS: Since cash payments make it difficult for marketers to 'understand' their customers there are a number of cashback card systems like 'payback' in germany which try to get people to identify themselves.

I agreed. Paying with card is fraught with slow terminals, bad card readers, many prompts in a row (Credit or debt, is this the right amount, do you want to donate $1 to something, do you want it all on one card, would you like to sign up for a store credit card, do you want cash back, how much, do you want a receipt?). For some reason, these all have a 2-5 second delay between them. I could make a system on a $2 arduino that was faster.

Some places like Starbucks seem to get it right. Swipe card and go.

Target however likes to hit you with all the options. Self checkout is even worse.

Cash workflow:

- Cashier tells you the total amount

- Since I was watching the register display, I already have a rough idea how much this will be, and I have prepared the bills to hand over.

- Cashier gives change and receipt

- I walk away, and after I'm out of the way, I put the change into my wallet.

- Done

Similarly, credit card workflow (American):

- Cashier tells you the total amount

- You insert in chip reader a card you already had out

- You sign, sometimes

- You wait 5 sec for transaction to finish

- You put card back in wallet while receipt is printing

- You put wallet back in trouser pocket while receiving receipt

- Done

The time spent on these is very, very similar. Being prepared with your form of payment and dealing with putting away the results (change, card, receipt) after you leave the line results in a very similar time. Signing (or pin) and waiting on the transaction takes a comparable amount of time to the cashier counting your payment and making change. In each case, less than 15 seconds, and at that point, who cares?

Around my area in the Northeast of the US, Apple Pay is becoming ubiquitous. I just put my iPhone near the reader and use touch id. It takes seconds at most and I don't have to expose my wallet to would-be muggers.

- You get asked if you want cash back

- You get asked if you want to donate to (charity/cause)

...

Credit card workflow in Australia for anything under $100:

- Cashier types in the total to the EFTPOS terminal

- You get your wallet

- You remove your card

- You tap your carda gainst the contactless reader, which registers the payment in about 1 second not 5 as you describe

- Cashier asks 'would you like a receipt for that?'

- You say 'no receipt, cheers mate'

- You put your card away

- You put your wallet away

If you pay over $100, you enter a pin and it takes maybe a little longer because no one crowds around each other at the payment area so there's none of what you describe and it always works despite the humidity you apparently describe.

As we don't have a tip culture, we don't see donation/tips/etc. prompts as others describe. It's only ever whether you want a receipt, and that's a single button press and you can pre-emptively say no to that so it doesn't even slow you down. Cash definitely takes longer here.

I was in Germany a few days ago. My credit card workflow:

- Cashier tells me total amount.

- I get my card from my wallet.

- I hold the card near the terminal.

- 2-3 seconds pass, terminal goes "Approved".

- Done.

It's easier than cash. Almost every store I went to had wireless card terminals, even coffee shops and supermarkets.

but you have to have a credit card that does that :) I for example don't have one, even though I do have a credit card for travels. Most Germans I know also don't want one because they usually cost extra money. And that is apart from the fact that the entire name 'Kreditkarte' -> credit card, implies one requires credit i.e don't have that money, not an easy sell here. Paying a yearly fee for having to look as if one needs credit :)

also its always a guessing game whether you have to enter a pin or sign. it seems a random distribution. same shop, same amount, sometimes pin sometimes signature.

PS: I am not saying its good or bad, just trying to give people a feel about some of us Germans

Germans have debit cards, which are also contactless. I never had to enter a pin when doing contactless.

Where the hell do you live that people think you are broke if you pay by card? And even then, who cares. Also, in supermarkets or so, there is a line and most of the time I see people respect privacy... payment by card is certainly faster unless you know in advance the amount and you already have the money ready in your hands...

And I wish we could solves the coin changes from Cash.

I like Paper Cash / Notes. I dont like Coins.

Another Reason I like Debit Card or NFC Recharge Cards like those in Japan is that they actually require me Charge the card first. This action will live in my subconscious how much I have spend. I know this is an unpopular motive in US where they just want you to spend and spend.

And Getting rid of Cash ( The so call Cashless Society ) is like having less freedom in a what is already less free world then before.

- Or you approach your wallet to the reader and pay via NFC.

- Done.

At least in the five years that I've been in America, the credit card workflow is almost never like that. It's more like

- Total amt

- (After deciding which card is best) Get card out

- Swipe, but piece of shit card reader complains, so retry. Or insert chip, then the piece of shit card reader makes the same sound for "wait" and "remove", sometimes cauing confusion.

- Wait for piece of shit card reader to show up signature bar (or less commonly the cashier has to print out a receipt and have you sign it)

- Done.

I love credit card rewards though, but I'm not sure if it's a zero-sum game.

You missed the step where the digital pen on a string doesn't work to sign the touch pad followed by using your finger.

I've found cash to be much faster and more pleasent than card for eating out.

- Waiter brings check

- Leave cost + tip

- Leave

If you pay with card that's an extra trip from the waiter which can take a pretty long time.

At the restaurants I frequent you can now either pay with an app on my phone or pay at a tablet/device that sits on the table. It is super convenient and so fast.

In countries where paying by card is common, the waiter will assume this and bring the terminal.

You can make it explicit, by having a card visible when you ask for the bill.

Speaking for America, where it's common to pay by card, I have never had a waiter bring a terminal to the table.

They take your card away and bring back a card receipt for you to sign & leave a tip on.

The mobile card readers are very uncommon in the US. In Canada, they're everywhere.

Numerous large restaurant chains in the US (eg Olive Garden) have installed small interactive screens at every table that act as a terminal, that do other things including take orders. When your meal is finished you pay by card at the machine and leave (it prints your receipt as well). I would expect this premise to essentially spread everywhere among non-fast-food chains.

In Europe, pretty much every restaurant, and many bars and cafés, have portable card readers. (If they don't, then they don't take payment at the table.)

There is no practical alternative, since the customer needs to input their PIN.

Dishonest waiters used to be considered a common way for card details to be stolen.

Example: https://www.paymentsense.co.uk/card-machines/portable/

I think it only takes standing in a few long lines to compare cash vs. card, to understand your analysis does not reflect reality(?)

Just count your cash as you queue. Though that whole thing in the US of showing prices not including tax seems pretty wack, what's the point ?

In efficient stores (e.g. Aldi in Germany and branches in Switzerland and Austria) the cashiers start taking the change into the hand the moment you say you pay cash. They do that up to the next bill and if you pay with a higher bill, picking up extra bills from the registry is really fast. Whereas with a credit card you put the card in, wait until the remote system decides if you should use your PIN or signature, then either put the pin in or wait until the cashier gives you the thing to sign and sign it. And if you're really unlucky the store has a system that looks you up in their customer database if you pay by card which adds another couple seconds.

The new contactless payment system is faster, unless the store does something stupid ... like wanting to do a customer database lookup before doing the actual transaction which one chain here in Austria unfortunately does.

You forget that American cashiers are incapable of arithmetic.

I found the whole swipe/insert thing really painfully slow and paid cash all the time.

Now though we have NFC tap-to-pay in Canada and it's wicked fast in comparison to everything. No signature, no PIN entry, connections seem much faster.

For many people credit card payment also means: - verify statement at the end of the month.

Which is annoying and time-consuming.

I'm surprised it's not mentioned on other comments, but in Japan, the whole thing is automated. The cashier feeds the cash notes / coins into a machine, and the machine spits out the exact change. It's super-fast, even when the cashier counts your change in front of your eyes, and lays it out neatly onto a tray[0].

I wonder how come these types of machines aren't more popular in other countries.

[0] sounds like some super fancy concierge service, but it's pretty much standard, from 7-eleven to fancy stores

Pretty normal in Norway as well. Cashier feeds notes into machine, customer drops coins in coin machine. Usually pretty fast if the machine reads the coins/notes immediately.

This happens in grocery stores in the US but many other stores don't have enough volume to bother.

That has turned out to be the comedy of the cash systems in the US. As I noticed the cash readers / auto change makers being installed in a lot of locations, it was just in time to rarely be used due to the shift to everyone using cards.

One factor that contributes to making cash slower in USA is the fact that the price displayed isn't the price you have to pay (because of taxes added at checkout time). You end up having to handle random amount of small change for something that ended up being $10.21 (but advertised as $9.99).

In most EU countries, the item would be priced at €10, you would pay with a €10 bill and move on.

You obviously have never been to a Home Depot or Lowes on a weekend and watched in abject horror how long it takes most people to navigate the pin pad to complete their CC purchase! The speed with which the transaction is completed is 100% dependent on the ability of the card holder to navigate all the prompts. At most stores I now have to wade through 4-5 prompts for input before my transaction is complete, this takes up to 30 seconds. This is nowhere near as fast as cash is if one is prepared and has their money out.

You're oversimplifying it. At some places (eg Subway), it was about 1 second timing for credit cards. At most stores, you would have to do things like say whether it was credit or debit, tell it yes/no to cash back, and tell it yes/no to whether amount is OK. All of them seemingly do it a different way. So, if you're used to it, the process might take several seconds. If you're not, significantly longer. Under Chip and PIN, you have that plus a several second wait in most places I go.

Cashiers with decent performance will take a solid bill like a twenty and give you back your change in a few seconds. If you want to give specific amounts of change, that adds time but so does when you split credit cards to put specific amounts on them. If anything, the cards can take longer since the transactions are separate. Wise users of cash also already have most of their money ready for payment by the time the order is totaled since it saves them time.

So, for most orders I see, the cash and credit take about the same time if customer is moving decent speed. The only difference is if the customer is moving slow for whatever reason (eg indecision or fumbling for stuff). That can happen with either but happens more for cash since credit users look for one item (the card).

> - You swipe card/insert in chip reader > > - Done

In Germany you always have to insert your PIN or sign the bill if you want to pay by card (we use debit cards mostly, credit cards are very uncommon).

I've talked to an Aldi employee as of late and he said Aldi is proud to now have the fastest Card processing of all the German stores (within the regulatory limits: you have to put in your PIN or sign the receipts except for those fancy/scary NFC chips) and the Cash workflow is still faster, according to their own statistics. Consider that I already look into my purse while standing in line to get an overview of my available coins and that the cashier starts to collect the likely change the moment they tell you the total amount. This speeds up the process considerable compared to the – likely more cash-inexperienced if I follow your description – American cashiers.

I can also second the opinion of many other commenters that the privacy implications of credit cards, especially the RFC ones which allow for invisible tracking, is a huge turn down of card payments in Germany.

And last but not least, as a developer, I gotta vent some air and complain that credit cards payments are huge pain in the butt, because of all those pesky special cases that arise from fraud prevention and risk reduction. Which isn't necessary for any sane payment method which can collect money directly from your bank account without the possibility of any charge-backs. This is one of the core reasons which persuaded me a European Fintech Startup Scene is necessary, so that Stripe with its CreditCard-centric API doesn't stand uncompeted.

I assume you talk about Aldi Süd? Their card handling is pretty fast and they can even start scanning the next customer's items while the machine is still processing. Aldi Nord on the other is hand is (while still faster than average) not particularly noteworthy.

> This speeds up the process considerable compared to the – likely more cash-inexperienced if I follow your description – American cashiers.

That doesn't make sense as a premise. The US wasn't lacking in experienced cashiers 15-20 years ago when cash was still king, nor today. There was a decade or more of time where the US rapidly transitioned from cash-heavy in stores over to card-heavy, the cards were universally faster unless the store ran a behind-the-counter swipe machine that the cashier had to use. The premise would have to be that in an economy with a super high GDP that has an extremely large service sector, America has especially slow cashiers everywhere (for no apparent reason given the extraordinary economic output overall). It's more than a reach.

Your parent comment was about Aldi. They have extremely fast cashiers, which is one of their cost reduction tactics.

As an American living in Hong Kong:

Cash can be faster because you do know the total before hand since the price on the menu/price tag is what you pay. This is because there is no sales tax or tipping. Buying 3 items at HK$12 each? Your total is HK$36. If there's a queue I usually have my exact change ready before I'm to the front.

In the US, you can rarely tell how much you'll pay since sales tax varies by county or sometimes by city.

A side effect of this is weird totals like $23.76 that result in lots of hard to spend small change which also disincentivizes cash use.

How about the NFC (Apple/Samsung Pay) workflow:

- Tap phone (that's already in your hand because you were aimlessly swiping while standing in line) to terminal with finger on fingerprint reader while cashier is ringing up items

- Tap confirm and sign once all items rung up

Here in Singapore they have started using automated cash machines the teller tells you the amount you feed it into the machine. The machine gives change. I use it for getting rid of all the coins once in a while and I don't have to count the coine just drop all the coins I have. If I drop in to much it I returns notes back if pposible. If the coins at a bank coin depositor they charge $0.01 per coin so if you are depositing at the bank you loose 10-20% for 5-10c coins.

Contactless workflow:

- You hold your card/device near the screen for about a second

- It authorises in a few secs

- Done

Are contactless terminals widespread in Germany?

On a short trip last month, I surprised a couple of merchants by paying contactlessly with my foreign (EU) card.

That's almost always faster than paying by cash, since there's no need to count the money or make change. The exception is when the cost is €20, and I can hand over a single note.

We have them in all major brand stores, all gas stations as well as all big supermarkets. Depending on where you are people might not have seen wireless terminal usage (especially if you are far away from a bigger city). A cashier once tried to force me to sign the bill when I payed contactless without a pin or signature (which is possible in germany if the total is below 25-30€).

> Are contactless terminals widespread in Germany?

They are absolutely everywhere since last year more or less, but everybody (esp. cashiers) is always dumbfounded when I use it and it works. Also some of them try to handle your card for you "to insert it in the right way" and since my German is still rather basic I then have to weigh the potential time waste of explaining it's a contactless card with the extra 4-5 seconds for the chip transaction. But I guess that part doesn't really apply to locals.

("kontaktlose karte, nicht einstecken" but they don't listen the first couple times)

Strange. In Austria it's pretty popular now.

Some stores have fucked up the speed of it though by first checking for your store membership account on the card which ruins the flow of the transaction. Often forcing the whole thing to be repeated. It's infuriating.

I was actually pretty annoyed by my bank having issued me a contactless VISA card, but for a particular reason: I already have a contactless card for paying at the university canteen, but with the VISA card also in my wallet, neither the canteen's own terminal nor a merchant's VISA terminal can pick up its respective card's signal properly without having to take the card out of the wallet.

Not German and I don't think there was ever such hyperinflation here, but same reasons basically.

- fast enough

- no problems with failing electronic payments of all kinds

- more places where it works (electronic payment systems can indeed be an extra cost which matters for small businesses)

- cash doesn't break (cards do)

- still easier to transfer directly between people

- pretty private

As a German a.) I mostly pay by credit card because it is way faster. By using paywave you can pay instantly at all larger shops and supermarkets. b.) The shops need to pay up to 1.7%. If you compare this against the time saved by not returning change and having to carry a money cassette every evening to their bank the saving potential is big. I try to not use cash anymore, but fail to do so in smaller shops or at the hair stylist.

Don't you guys have paywave for under 25e purchases? Its literally 5 seconds to pay for anything. Literally no one uses cash in Helsinki. I can even use my phone's NFC as a payment option.

We have and pretty much all supermarkets accept that. Doesn't mean that cashiers have even heard of it (even pointing to the huge signs advertising that at the register surprises some) or customers are aware of it. It doesn't help that the national debit card scheme Girocard hadn't had working contactless payment until recently (which is the type of card most customers use).

As someone who lived two years in Germany

a) That's a good joke. From faster to slower: NFC > PIN > signature > cash.

b) You should look into the real cost of dealing with cash. EC is stupidly cheap since it's basically the cost of a SEPA direct payment (we're talking 1-2 cents per transaction). Debit card payments can also be pretty cheap in Europe. All those annoying restaurants and small shops that take only cash do it to dodge taxes, not for any other reason.

I also suspect tax avoidance rather than transaction costs

Transaction costs for cash is probably higher than for credit cards.

For cash you have to count and recount that cash at the end of the shift, and then the bank counts are recounts it again. This is a significant amount of labor. By contrast with a card once the initial transaction is done everything is put into the computer electronically and no human has to look at it again.

Also cash is subject to theft. In some locations this risk is a significant part of the transaction costs - not just the cash, risk of death in the robbery. Electronic payments are subject to loss, but generally there is a trail to chase when it happens, and the possibility of death is much less.

Not really.

Until 2016, the costs were 30€/mo+0.125% for EC, 160€/mo+4% for VISA and MasterCard, 160€/mo+7.5% for AMEX in Germany.

Most German merchants run on margins below 1-2%. Good luck paying 7.5% transaction fee on a margin of 1%.

This is why EC was far more widely accepted, although even that was too expensive for small places, such as farmers selling stuff on the market.

Nobody to my knowledge has every measures the costs of cash, it is just something they accept. With credit cards it is easy to measure because you get a number, but with cash it is not, you have to calculate too many different parameters and figure out what applies where.

I'm pretty sure every single German supermarket chain measures that, it's just a requirement to operate at those margins. The Edeka cooperative published in 2012 that their all-in cash handling cost is 0.14%. The 2013 Steinbeis Cost of Cash study[0] estimated a much higher number of 2.7% for merchants. The truth is probably somewhere in between.

Such studies have also been used to arrive at the EU interchange cap.

[0]: http://www.steinbeis-research.de/images/pdf-documents/CFP_Co...

The cash is counted by machines at banks, which I'm pretty sure almost never make an error doing so, and I'm sure it's less often than human counting error.

Margins in many businesses are razor thin in Germany. Which is the reason Walmart and others stopped doing business in Germany. For many businesses 1-2% transaction cost is the difference between success and failure.

But yes tax avoidance is a huge problem in restaurants in Germany.

How do they pay their employees if margins are razor thin? They'd have to operate on a huge scale to have enough profit to cover expenses and especially payroll. I would love to see a comparison of the balance sheets between some German and U.S. small businesses. Small businesses don't have the huge scale to live on a razor thin margin, so that's why I'm curious.

Also surveillance avoidance. Cash is awesome for leaving fewer traces.

As someone who lived 40+ years in Germany ...

Sorry, but what is "EC" and "SEPA", and what do they have to do with the real cost of dealing with cash?

Germany doesn’t use the MasterCard or the VISA network, instead having an entire separate payment network, EC, which uses under the hood wire transfers via SEPA. This is the E in EMV (EC, MasterCard, VISA) which created most of modern payment infrastructure.

SEPA is the Single European Payments Area, standardizing how to process fast and cheap payments, all transfers are in Euro, from 2018 on also having a standardized API between banks, wire transfers are free or below 1 cent each, etc.

Thank you for explaining those, but I'm still not sure what they have to do with the "real cost of dealing with cash". EC and SEPA seem to be digital payment technologies, and therefore aren't dealing with cash.

I would think that the means that banks charge for dealing with cash inputs, either directly or indirectly, to cash heavy businesses.

> Germany doesn’t use the MasterCard or the VISA network

Well, it is used (almost all major stores and large grocery chains support both Visa and MasterCard), but Girocard is far more widespread.

Only since the EU limited the fees. Until 2016, neither ALDI nor LIDL nor REWE nor PENNY nor Edeka nor Coop supported it.

I know it's nitpicking but Rewe has accepted credit cards since 2007.

Some REWEs have, but not all. There's still some where I live that don't. (REWE eG is a cooperative, so it's all a bit more complicated)

Basically there is Rewe Dortmund (with stores across NRW) and Rewe anywhere else (including NRW). The latter requires credit card acceptance for all Rewe-branded stores. If a store does not have that, an email to Cologne usually changes it.

There's also Rewe and Coop (Sky, Plaza, etc) in Schleswig-Holstein, which have merged now, but offer different amounts of credit card acceptance.

And members of both have reservations against MasterCard and VISA, due to what happened with Rossmann a few years ago (Rossmann sold cuban cigars, as punishment MasterCard, VISA and PayPal seized Rossmanns funds and suspended all payments), but as EC was also bought by MasterCard and merged with the Maestro brand, currently there's no option but to continue on.

Personally, as member of both the REWE eG and coop eG, I'd support a move away from CC to any national or EU based payment system as soon as possible.

I know that there are some reservations but the rule the cooperative (including SH) decided as binding still stands. You are of course free to lobby internally for change.

Rewe has a fairly complicated legal structure, I'm not sure which you are a member of. There is no single "Rewe eG" which you can just buy into, especially not if you don't happen to own supermarkets.

EC was not bought by MasterCard, the brand was always owned by them (though there have been various mergers). The system behind those cards was not merged with Maestro (which is a different system) but merely rebranded as Girocard, an independent scheme by the German banks. It works without any reliance on MasterCard.

> Rewe has a fairly complicated legal structure, I'm not sure which you are a member of. There is no single "Rewe eG" which you can just buy into, especially not if you don't happen to own supermarkets.

I'm personally not sure either. Originally my entire family was just a member of the coop eG, but when they started to merge with REWE eG in the past months the coop eG offered an option to invest additional money into the REWE eG (at better than usual terms). So we did.

https://www.shz.de/regionales/schleswig-holstein/tschuess-sk...

So now we have some stores that have just been rebranded REWE, some still branded Sky, operating with the same mix of REWE and Sky products, and some accepting CCs, some not.

> The system behind those cards was not merged with Maestro (which is a different system) but merely rebranded as Girocard

In marketing, EC stopped being the main brand, though, and MasterCard provides their EC cards under the "Maestro" brand within of Germany, although they are not operating over the Maestro network, or in any way compatible with it. Take any recent EC card, it'll work only via the EC system, say Girocard Electronic Cash on the back, and Maestro on the front, but doesn't actually have any relation to the Maestro system. That's what I was referring to with the rebranding.

EC is Eurocheque, a German specific card system. In my experience in Germany, lots of places take EC but neither visa, mastercard or amex, so in effect, only Germans can pay with credit in a lot of places. This is true even in Frankfurt (arguably the financial capital of Europe). In the cafeteria of a place I frequently work, they also don't take cash, so foreigners can't eat.

SEPA is the single euro payment area. Here it refers to the cost of a wire transfer.

Now that we are talking about card payments (NFC, chip and pin, etc.): jump into a random Frankfurt taxi in 2017, and IF they are willing to take your card (pretty big if), this will be their method of choice:

http ://fernandodecordoba.es/wp-content/uploads/2012/04/bac1.jpg

They put your card in there, put a paper on top, and proceed to press and copy the embossing of all you card numbers into a carbon copy paper. Talk about swipe card insecurity... That is by far the slowest way, you spend 5 minutes easily.

I agree with the laundering / tax evasion cause only partly: I once wanted to pay upwards of 900€ in IKEA with mastercard. The cashier asked me to go to an ATM that was inside the IKEA building, take out cash from the card, and pay with that. With its scale, I don't think IKEA prefers cash to launder money or evade taxes...

> EC is Eurocheque, a German specific card system.

Eurocheque hasn't existed since 2003. The current system is Girocard (https://en.wikipedia.org/wiki/Girocard), it's just that the colloquial name is still "EC".

Cash might be faster if you have to do Chip+pin.

In most countries, we just tap to pay with NFC (except America, where this only works with Apple Pay or Google Wallet). This is most definitely faster than cash. You can actually go to any store and time it on real customers.

German here as well:

In addition to a.), I like having full control of my money and not be dependent on some third party when making purchases.

I recently moved from the Netherlands, where card is overwhelmingly favoured (at least in Amsterdam and Den Haag, I've never been somewhere that doesn't take card and some places refuse cash) to Berlin, which I think is even more pro-cash than most of Germany. Cash is way slower, and I've now got a couple euros' worth of coppers that are utterly worthless because no-one's going to bother counting them out. In the Netherlands the smallest denomination of cents is 5, but you could live for years there and not know, because almost everywhere takes card (and most machines support contactless).

Most larger bank locations have a machine you can just throw your copper into.

It is weird how Germany is still so cash based. Even younger kids will count out coins at grocery stories, and they're convinced it's faster than using a card (their cards do take a while). Most of their cities still use paper train tickets! Many cities are skipping the tap/card systems all together and going straight to phone apps (which I don't really like. My card will always validate if a ticket inspector comes on the train. My phone can run out of battery).

For the most part, I would say paying by contactless is faster than paying in cash because you need to wait for the cashier to find the change for the cash you gave them. Then especially in Germany, people spend ages looking for really small change so if it's 19.64 they can give them 20.14 and get a 50 cent back. Where as contactless you tap the holder and that's it. Even paying by pin is generally faster. The only reason it's sometimes slower is if they use a German bank that wants a signature over the pin or the cashier doesn't know how to use the card machine. (I've had that once or twice in Rewe and Edeka)

I was on holiday in Germany. In The Netherlands I pay everything with my contactless debit card, where you hold it near the reader, wait 1 second and then you've paid.

Every cashier in Germany (provided they accepted cards in the first place) insisted on "taking" my card, sticking it in the machine for a non-contactless payment, then hand me the machine so I can enter the PIN, then take back the machine, wait for the transaction to finish and then remove the card from the machine and hand me back my card. If that's the standard card-experience, I can imagine why you think cash is quicker...

(At one shop I saw the machine accepted contactless; before the cashier could take my card I quickly paid contactless. The cashier was 50% flabbergasted and 50% upset and seriously doubted I actually paid, until the receipt rolled out to prove it).

But ... what if you lose your card??

I guess Germans are generally very precautious and wouldn't trust contactless debit cards.

Well, cards can be canceled and fraudulent payments reversed. The same can't be said of cash.

This is also why I prefer using credit over debit cards: with credit, a fraudulent transaction (before being cleared) is merely decreasing my available funds (and because I generally pay off my balance monthly, this has zero impact on my life). With debit, the money comes out of my account, and only once a fraud investigation is complete do I get my money back.

Contactless cards also typically have a per-transaction limit in the area of $100~$200, so the amount of damage someone can do without the PIN and before you cancel the card is quite limited. I actually wouldn't be surprised if you do too many transactions in a certain period of time it would ask you to do a PIN transaction.

Then again finding a working Sparkasse ATM in Berlin is always something you have to plan to do a couple of times every week, or then you must carry lots of money with you.

Again I owe to my colleague for my lunch because I forgot to pick money in the morning.

Brazilian here. We had a three-to-four-digit annual inflation rates that last 14 years, from 1980 to 1994 (and it topped 5000% on the last year). Almost everyone uses debit or credit card nowadays. Even transport cards machines, taxis, small vendors, food trucks accepts credit cards. Usually I only carry cash for some emergency to the point I don't even remember how much I left on my wallet.

To be fair, in Brazil we usually prefer cards because of the risk of being robbed.

True, Uber's decision of allowing cash payments in Brazil(because a lot of people can't get a credit card approved) was met with a very negative drivers' response due to increased robbery risks.

Fellow Brazilian here and I don't carry a lot of cash with me because that was how I was raised, mostly my parents taught me to be scared of being robbed with a lot of money. Even though I am not living in Brazil ATM I still act like this.

Plus fraud is becoming rarer with chip credit cards(and apps which allow you to lock your card much faster in the case of theft), while counterfeit bills are also harder to reproduce these days you can still find some.

Also remember that whole Eastern Europe (including East Germany) had no electronic payments before fall of Soviet Union.

So credit cards took off in US in 80s but half of Europe just got out from under communism in early 90s and they were not very trustworthy of western banks so would prefer cash.

Also the banking and payment infrastructure was non existent so needed to be built from scratch. This probably slowed down uptake of credit/debit cards considerably.

Cash is still king in Eastern Europe today.

Not sure how far east you want to go but in both Poland and the Czech Republic card payments are far more prevalent than in western Germany.

With young people yes. But older generation still uses cash heavily.

Your economy is much more stable than mine in the UK yet anecdotally I've observed we use cards to pay for everything. Even silly little things that only cost a couple of £.

In fact it is rare that I ever carry cash. The same is true for a fair number of my friends and family as well.

I second this anecdata. I carry an Amex (credit) and a Mastercard (debit) backup. I don't carry any cash unless I know I have an imminent need.

"Always carry enough cash to get home" - my dad.

But otherwise I'm in the same boat. Amex for everything I can possibly use it for, Visa for places that don't take Amex, Visa debit when I'm under a CC limit.

> "Always carry enough cash to get home" - my dad.

In London you can't pay for a bus with cash any more.

You can still buy the oyster card with cash however, right?

Now try catching a bus late at night after the shops close - what a silly system.

Finding an operating cashpoint late at night isn't especially easy either (and the reason most are shut down is that operational ones tend to attract muggings). It's a pretty practical system IME; having a payment method on you is no harder than having cash; indeed in this age of phone payment it's easier.

I never came across a cashpoint in Britain that was closed at night. Is this a recent change?

> You can still buy the oyster card with cash however, right?

You don't need to buy an Oyster card as contactless bank cards work on Oyster systems as well.

> Now try catching a bus late at night after the shops close - what a silly system.

London is a 24 hour city. :P

>Even silly little things that only cost a couple of £.

I use a credit card to pay for a $1.25 coffee. I never have cash, partly because I forget to take some out.

Contactless is faster than making change, so it's just far too convenient to use a contactless card.

Same here, though I think a lot more recently than a few years ago because of the growing ubiquity of contactless options which are very convenient for those small payments. Is that payment option as common in those countries at this point?

I'm pretty sure I used my UK (debit) card, the other day, to pay for something absurdly cheap - maybe 49p? I was about as surprised that they accepted it as I am when a shop requires me to pay a huge minimum - e.g. £10 - and it's not quite as straightforward as "big shops do this, small shops, that".

The "I only have my debit card on me. What's your minimum spend" conversation used to be annoying. Thankfully that's been less of an issue since contactless as shops now often expect you to pay for small items on card.

Contactless is wonderful, especially now the receipt for smaller items is effectively being phased out; couldn't the receipt-handling just get handed over to banks, ultimately? That could be really useful...

I still use cash, probably more than the average. There are just a handful of situations - paying for a newspaper, or at my local bakery - where it feels more 'natural' to me to use cash, but I'm sure that feeling will go eventually!

Argentina has rampant cash usage at all stages of inflation, mostly for tax evasion purposes (VAT is 21%)

> As a German I call that theory into question. Our currency has been stable for 60+ years.

Also as a German, OUR currency has been stable for 26 years.

I'd still question the theory.

Yeah, what a silly theory. Not once have I thought "oh, gee, I better not pay with CC because remember what happened back in the 20s/30s". And yes, you could argue for some sort of cultural trait that stems from that time, but I don't know anyone who pays with cash because they inherently distrust the financial organisations.

Wouldn't it be only 15 years? (Since switching to a new currency)

Re-unification was in 1991.

The Euro transition was stable.

Debit card is pretty equivalent to cash, though. When my friends and family from my hometown (Istanbul) visit me the first time, they are usually quite shocked that most shops here do not accept credit cards at all. In Turkey (a place I call micro-USA), many credit cards automatically divide the payments for some transactions to 3+ months, whereas here in Germany, there's always some bureaucracy involved, even if you explicitly ask for it.

11 years ago, when I was living in Istanbul, I had bought bread from a supermarket and I paid with my credit-card, vendor of which had a deal with that supermarket-chain and automatically divided the payment of the bread to 10 months. If I remember correctly, they later banned the postponing of the payment of basic goods because it was getting ridiculous.

Not really. Debit cards are debit cards, not cash. You are comparing CC to DC as far as I can tell, but they are completely different products. There is a huge difference between having currency in your hand or use a medium to access money held by the private organization that can go bankrupt (and this happens much more often than, for example, governments with their currencies).

When paying with cash you are also only exposed to the risk of loosing what you have on hand. A debit card is a bit more akin to handing over the key to the vault with a contractual agreement as to how much can be taken.

If you think that is a problem with debit cards you should go get a better bank.

Are there banks that provide credit card-like protections for debit cards? I thought you couldn't reverse debit card transactions. There are usually daily limits, though, which would limit how much you could lose.

I haven't had this problem with my bank just pointing out the inherent differences. With a debit card you are relying on the cyber security and data retention policy of the store, the bank, and the electronic network provider.

Now I realize that if your account is used without authorization most banks refund the money. This can take a certain amount of time and could lock up your remaining funds in the meantime.

Less than a month ago my card details (the magnetic stripe) got swiped. However my bank noticed the funky payments, automatically detected the issues, temporarily froze the card. Then when I noticed it didn't work and called them they temporarily locked up the card for a single use, and then blocked it permanently and sent out a new card.

I noticed it on Thursday, I had the new card and all unwanted transactions rolled back on Monday.

This for a debit/Visa hybrid card, which acts as Visa out of country and on the Internet.

Also, the bank requires me to temporarily unlock the card for 'unsafe' Internet purchases before usage, which basically is all purchases that don't involve 2FA.

If you think this. Or the dozen times credit card data have been stolen in mass from websites aren't a serious issue you should read more news.

I know I can charge back. But then I need to waste time to check all the charges and go through the charge back process.

Also depit cards. At least in Europe. AFAIK don't offer a easy charge back at all

The laws on liability are very different in Europe and the US. In the US a stolen card is the bank's problem. In Europe it is the consumer's problem. This difference in laws is critical to this discussion, both sides are saying "you are wrong" when in fact both sides are right in their respective country and wrong in the other.

It's not in Europe. It's just a hustle when it happens

Both Germany and the US insure savings accounts for 6 figure amounts, meaning bankruptcy is not a major concern for most people.

This may be so. I often wonder though if this "disaster recovery plan" has been tested with any bank of significant size. Maybe that's where the whole too-big-to-fail thing comes in.

Depends what you consider significant. The UK's Financial Services Compensation Scheme, which handles depositor protection, paid out over 26 billion pounds in the 2006-2011 period.

At the same time, though, the govt did push Lloyds TSB to take over HBOS in 2008 rather than let the latter fail.

There is a distinction only if you mean holding all your cash in your own safe, when you say "cash". You will need to get a bank account anyway as transactions of a certain kind and size (like getting your monthly wage and buying a car) need to go through a bank.

There is zero practical difference if you withdraw from an ATM every other day or more often, so you can pay cash.

Some relevant info: In the USA average consumers are protected by the FDIC for the balances of their deposits up to $250,000. A large number of banks have consumer liability limits in place for protection from fraudulent charges on their credit cards.

https://www.fdic.gov/consumers/banking/facts/

In case of large defaulting companies history has shown that there are no 100% safety nets despite all claims.

Those claims are made to increase trust and lower market interest rates for companies to borrow money but regularly failed once really needed.

>There is a huge difference between having currency in your hand or use a medium to access money held by the private organization that can go bankrupt (and this happens much more often than, for example, governments with their currencies)

From some aspects, yes. From others (no interest in purchases, directly reducing one's account balance, etc) they are the same.

Still not often enough to matter, especially since the cash one has at hand will be a limited amount anyway.

It's not like having $100 or $300 in your pocket to buy things (as opposed to using a debit card) really protects you from the "private organization that can go bankrupt", when the large majority of your money will be in some bank anyway.

Except if you propose we keep all our money in cash at all times. This has other issues, not just a government going bankrupt, but inflation, theft -- and those things are much more common than a bank going bankrupt.

I've never heard of anything like the dividing of payments you're describing. Are you saying that the CC company doesn't pay the merchant all at once, by default? That seems really shady. They should either have enough capital to pay the merchant in-full right away, or they should pay the merchant the interest they're collecting from the buyer if they buyer isn't paying the CC bill in full each month.

The bank pays the full amount immediately, unless they have a special agreement with the seller. You get different treatment according to your CC provider. Here is an example: http://www.gold.com.tr/BankaKampanya.aspx (Turkish). "Peşin fiyatına 3 Ay taksit" means "3 months payments without interest". They usually inflate the price beforehand to account for such payments, so you are disincentivized to use a debit card or to pay in cash. Such tactics are fought against by the national banking organization but they always find another way (like having ridiculously low, "symbolic" interests for specific sellers/goods). The whole situation used to be grim when I left Turkey many years ago, but I don't imagine it being better now.

Ah, I see. In the US a common marketing offer for credit cards is that they let you make one charge that will be interest-free for 6 or 12 months. You can pay it off whenever and however you like, but if you don't pay the whole thing before the deadline you'll owe all of the interest for the whole period. They make money off of this two ways:

1) People forget to pay it off before the final date. They're not always clear about when that date is; you know exactly how long it's been since the charge, but you don't know for sure when your payment will be applied. It's best to pay the total off at least a month before the final date, to be sure it's paid during the billing cycle before it is due.

2) If you use the card for anything else, there's fine-print that says that any payments will go towards non-promotional charges first. It can get very difficult to determine if you've paid the promotional charge off or not, and they typically do not assist you in figuring that out.

They also benefit from extending you more credit than you need for the one charge you want to make, especially since you're unlikely to use it in order to avoid trap #2. And they benefit from having an additional customer on the books. I'm sure these benefits make them money somehow too.

This sounds like the most fantastic way to get a literal wage slave.

Exactly, I mean, maybe it's not clear from my comment but it was very hard to calculate how much disposable income I'd be left with after the monthly payments. In the statement, you see how many payments left for each transaction but when you buy practically everything like that, one would need dedicated software to figure out his/her financial situation.

The Turkish payment system really is an eye-opener for its sophistication. I used to work in credit cards and did a study tour to Istanbul in 2004 to see it first hand and talk to both merchants and the issuing banks.

One big difference in Turkey is many shops had 5 or more card terminals, each in the colour of the issuing bank. Banks competed for both merchants and consumers by offering value-added features unique to their terminal, such as instalment credit instantly accessible to only their customers.

Instalment credit was popular in Turkey following the economic crisis in 2001 (3000% interest rates) because many people simply didn't have the cash to pay up front for major purchases such as whitegoods or even shoes.

In most other countries, shops have only one payment terminal, supplied by the acquiring bank (acquiring = acquires payment transactions, as distinct from issuing = issuing payment cards to consumers). That terminal has to support all cards equally, using the base Visa/MasterCard standards. Hence there are no value-added payment options.

They are still popular, and they are doing everything they can to reduce your ability to compare their offerings: https://translate.google.com/translate?sl=tr&tl=en&js=y&prev...

We had hyperinflation in Brazil (end of 80s and begin of 90s) and you can use credit/debit card almost everywhere (I even saw a video of a Brazilian that lived in Japan for 10 years commenting how weird this is for him)

I can add that in Mexico the culture is to also not carry that much cash - due to risk of robbery and losing the wallet or it getting washed in laundromats.

Our currency has been stable for 60+ years.

Older osti don't see it that way. When I say "older" I mean "everyone over the age of 40" so not really that old. They've seen their currency change.

Did you learn about the inflation @ school? In the UK we weren't taught about the Weimar Republic's hyperinflation (in education up to 16 y/o). My friend who did history @ a more advanced level was, however.

Yes, I learned about the Weimarer Republik and it's economic issues in school in Germany. (I guess it was in 8th or 9th grade and that history class was mandatory.)

Looks like the Bitcoin laws are v favourable in DE. You can pay taxes in BTC(!) & BTC is a unit of account[0]. That makes sense if the memory of WR hyperinflation is written to the citizens' mind.

[0] https://en.wikipedia.org/wiki/Legality_of_bitcoin_by_country...

You can't pay your taxes with Bitcoin (the Wikipedia author probably means something else?). You can't even pay most tax in cash even if you wanted to. Bank transfer in EUR is the only way.

The Wikipedia author cited a quite unclear CNBC story that said that bitcoin "can be used for tax and trading purposes".

From what I can tell from other sources, what it really means is that one must pay VAT when purchasing stuff with it.

Really? It's standard in Portugal, as part of the context of WWII. My textbook even had a picture of people with a pile of bills.

Mea culpa.

I think I'm wrong here.

---

HN throttles comment time. Annoying. I don't want to give away my ideas/time enough to tolerate shit like that!

It's part of the GCSE curriculum, which is examined at age 16.

http://www.bbc.co.uk/schools/gcsebitesize/history/mwh/german...

(Please write "at".)

I don't remember that. @.

I'm downvoting this because you didn't write

  I don't remember th@.

Too good!

> Euro

> stable

Reply on news.ycombinator.com