Germany Real Time Payments Market - Growth, Trends, COVID-19 Impact and Forecasts (2022-2027)

The Germany Real-Time Payments Market is Segmented by Mode of Payment (Person-to-Person (P2P) and Person-to-Business (P2B) ).

Market Snapshot

Germany Real Time Payments Market
Study Period: 2020-2027
Base Year: 2021
CAGR: 31.5 %

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Market Overview

The German real-time payments market is expected to register a CAGR of 31.5% during the forecast period (2022 - 2027). Real-time payments typically focus on low-value retail payment systems (RPS); they differ from real-time gross settlement systems (RTGS) and distributed ledger payment systems. In addition to meeting the demands and expectations, real-time payments have generated interest from the regulators, competition authorities, and payment service providers. Regulators believe that instant payments will expand access to banking services, support economic growth, provide alternatives to Visa/Mastercard networks and reduce the use of cash and cheques.

  • With the rise of new payment technologies developed by non-bank payment service providers (PSPs) and banks, businesses and consumers now have a wide range of payment instruments. With the rise of technological advancement, these facilities are reshaping the fintech world, leveraging the power of advanced API, AI, and mobile banking solutions.
  • Real-time payments are being touted as a game-changer for moving cash-loving Germans into digital payments. SCT Inst solves the negative cultural association of credit cards. As per the data by FSI Many smaller banks have opted to use payments via a technical service provider to deliver real-time payment mode transactional services and solutions for consumers. Real-time payments in Germany are expected to make up 37 percent of all retail payment transactions by 2027.
  • Germany has been experiencing a major transformation with the recent regulatory reforms in the Euro region. Many major players are trying to take advantage of the opportunity to establish themselves as a business and Fintech solution provider. For instance, the establishment of the Single Euro Payments Area (SEPA), Payment Services Directive (PSD2), and the establishment of the Euro Retail Payments Board (ERPB) have aided the growth of the market.
  • The COVID-19 pandemic has turned out to be a catalyst for digital transformation and thus an “innovation accelerator” for the economy. The market has already been going through a major transformation, with participants shifting focus toward e-commerce to do more shopping online. Pandemic intensification and changes in regulation like lockdown and touchless payments benefitted the industry. Along came features like Insurance as an added service, particularly in buyer protection (e.g., as provided by PayPal and credit card providers). Cashback points for rewards and special offers appeal to some participants.
  • The real-time payment solution has easily given consumers and businesses the luxury of ready access to funds and the convenience of transferring them with a single button; however, there are also challenges related to the cost of adopting a new payment infrastructure, financial crimes related to payments, technological failure, and cyberattacks, which the industry has faced since its inception.

Scope of the Report

The Germany Real-Time Payments Market is Segmented by Mode of Payment (Person-to-Person (P2P) and Person-to-Business (P2B)). Real-time payments are instant payments, faster payments and immediate payments. The real time payments allow immediate availability of funds to the beneficiary of the transaction and is irrevocable. The confirmation of the recipt of funds is instantaneous and the balance is immediately deducted from the sender.

By Type of Payment
P2P
P2B

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Key Market Trends

P2B Segment Will hold The Major Share of the Market

  • According to a report published by ACI Worldwide, a payment float is a deposit into a bank account that has not yet been cleared. With its current share of real-time adoption, German businesses and consumers will gain an estimated net efficiency saving of USD 313 million in 2021, driven by a reduction in the payment float. Instant payments unlocked a total transaction value of USD 4,823 million daily in 2021 through a reduced float time in Germany. This working capital facilitated an estimated USD 114 million of firm output in the same year.
  • Recently in June 2022 EPC (European payment council) publishes the final version of the standardization of QR codes ( mobile-initiated ( SEPA) payment) involving the P2B mode of transaction addressing the need for a regulatory body for Instant credit transfer (SCT) payment and transfers, which seems to make real-time payment more secured in upcoming future. looking forward to these regulatory reforms Germany is expected to double its real-time payments volume by 2026.
  • As per the study by Deutsche Bundesbank at the end of 2021, three out of four (73%)payments of the debit card in Germany were contactless using NFC Technology. In Germany, there are more than 100 million cards in circulation. The system is operated by the German banking sector and is independent of international credit card companies like Visa and Mastercard which is expected to favor Germany in real-time payment settlement in the near future.
  • Real-time payment market has been experiencing tremendous changes with the introduction of new players which has been a key factor to drive the market for instant germany N26 bank one of the first organizations to provide real-time payment solutions in the region key to these sytems lies in the new digital banking application programming interfaces – APIs.
  • Recently, Germany's savings banks introduced a new feature allowing customers to make a transaction as an instant payment. But it only works if the receiving bank also supports instant payments. With technological advancement and the adaptation rate of the real-time payment mode in the region, an increasing number of lenders in Germany have already joined the group of early adopters of the technology, which has been a key factor in driving the real-time payment market in Germany.
Germany Real Time Payment Market

Ecommerce will be the Key to Drive The Market

  • Germany's e-commerce business has proliferated since the pandemic, and sales have increased across the region during the coronavirus pandemic. For Instance, the report posted on eCommerce business 2021 by Postnord reflects approximately 94 % of the population is shopping online, which is 62.1 million consumers. The report also suggested that most B2C companies prefer real-time payment settlement with vendors like Paypal, Apple Pay, and Google pay in Germany.
  • The recent survey from Postnord also reflects that Germany is at 4th position in countries where Europeans shop online (number of millions who shopped from each country (China, USA, and the UK). It's approximately 26 % of the total consumers in the European region. The study also suggested that the preferred payment gateway in the area be PayPal or a similar option at 50%, followed by invoices at 21%, debit or credit card at 17 %.
  • As per the report (2021 European E-commerce Report) published, 96 % of the total population in Germany have access to the internet estimated growth rate of 1 %, and 88% of that internet user that bought goods or services online growth rate expected to be 2%from the previous year 2020.
  • The global pandemic has changed the entire scenario of doing business; an increased need for immediate transactions and enhanced digital payment solutions across industries have become necessary. Contextual commerce is on the rise – allowing workers, merchants, customers, and suppliers to implement a quicker way to do business that fits into their 24/7/365 lifestyle.
  • With the country's new technological reforms and regulations advancement, Germany has a heterogeneous market for real-time payment systems. The key reasons are the growing digitalization level, changes in customer behavior, and the advent of the PSD2 regulation by deploying technologies such as NFC or QR codes.
Germany Real Time Payment Market

Competitive Landscape

With consumer preferences changing rapidly, the market has become a lucrative option and thus, has attracted a huge amount of investments. Due to the huge growth potential, the market is moving towards fragmentation due to the new entrants. The service providers are engaging in partnerships to promote product innovation.

  • June 2022 - Germany-based digital payments processing company ePay and Euronet Worldwide announced additional product launches. ePay offers a portfolio of business incentives, gift cards, and payment solutions, such as eCommerce, card acceptance, and mobile for omnichannel commerce. These services include point-of-sale (POS), end-to-end ATM, card outsourcing solutions, card issuance, and merchant acquisition services.
  • May 2022 - Ria Money Transfer, a business segment of Euronet Worldwide, Inc., a key player in the cross-border money transfer industry, announced a new partnership with Rebtel, an international calling service provider based in Sweden. The partnership embeds Ria's international money transfer service directly into Rebtel's digital platform, making it easy and convenient for Rebtel's customers to send money to loved ones worldwide. Ria offers payments to bank accounts, mobile wallets, and cash across 170 countries and territories and is powered by Euronet's Dandelion service, the world's largest real-time international payments network. Embedding a money transfer feature presents a unique growth opportunity for Telcos wanting to enter the fintech space.
  • June 2021 - Deutsche Bank and Fiserv are entering into a Joint venture to provide a payment solution for merchants. The joint venture is to combine Clover's payment acceptance solution with Deutsche Bank's integrated banking services. The joint venture will serve small, medium-sized, and small, medium-sized enterprises (SMEs) and will be based in Frankfurt am Main, pending regulatory approval.

Recent Development

  • In June 2022, Mambu, a Germany-based cloud banking platform, has teamed up with cross-currency money movement Western Union. Mamby will integrate its solution into the Western Union’s digital banking platform and next-generation real-time multi-currency digital wallet in Europe. Mambu will enable Western Union to create a new banking experience and extend the relationship with its customers. Mambu, With its cloud-native platform, has over 230 banks and financial institutions as customers and 70 million daily users.
  • In June 2022, Germany-based Fidor Bank has planned to roll out new contactless bank cards, including fingerprint ID, to authorize payments. The novel cards are created by fintech Zwipe, specializing in biometric technology. It provides services by Mastercard and Visa cards through its Zwipe Pay platform, which is expected to roll out by the end of FY 2022.
  • In June 2022, Enterprise blockchain and crypto solutions provider Ripple, partners with Lunu to support the Germany-based company's luxury retailers in accepting cryptocurrency. Lunu allows luxury and high-end retailers in the UK and Europe to accept crypto payments in-store via an online widget and Lunu's point of sale (POS) terminal. Ripple launched Liquidity Hub to support long-term crypto adoption.

Table of Contents

  1. 1. INTRODUCTION

    1. 1.1 Study Assumptions and Market Definitions

    2. 1.2 Scope of the Study

  2. 2. RESEARCH METHODOLOGY

  3. 3. EXECUTIVE SUMMARY

  4. 4. MARKET INSIGHTS

    1. 4.1 Market Overview

    2. 4.2 Industry Attractiveness-Porter's Five Force Analysis

      1. 4.2.1 Bargaining Power of Suppliers

      2. 4.2.2 Bargaining Power of Buyers/Consumers

      3. 4.2.3 Threat of New Entrants

      4. 4.2.4 Threat of Substitute Products

      5. 4.2.5 Intensity of Competitive Rivalry

    3. 4.3 Evolution of the payments landscape in the country

    4. 4.4 Key market trends pertaining to the growth of cashless transaction in the country

    5. 4.5 Impact of COVID-19 on the payments market in the country

  5. 5. MARKET DYNAMICS

    1. 5.1 Market Drivers

      1. 5.1.1 Increased Smartphone Penetration

      2. 5.1.2 Falling Reliance on Traditional Banking

      3. 5.1.3 Ease of Convenience

    2. 5.2 Market Challenges

      1. 5.2.1 Payment Fraud

      2. 5.2.2 Existing Dependence on Cash

    3. 5.3 Market Opportunities

      1. 5.3.1 Government Policies Encouraging the Growth of Digital Paymentis expected to aid the growth of Real Time Payment methods amongst commoners

    4. 5.4 Key Regulations and Standards in the Digital Payments Industry

      1. 5.4.1 Regulatory Landscape Across the World

      2. 5.4.2 Business Models with Potential Regulatory Roadblocks

      3. 5.4.3 Scope for Development in Lieu of Evolving Business Landscape

    5. 5.5 Analysis of major case studies and use-cases

    6. 5.6 Analysis of Real Payments Transactions as a share of all Transactions with a regional breakdown of key countries by volume and transacted value

    7. 5.7 Analysis of Real Payments Transactions as a share of Non-Cash Transactions with a regional breakdown of key countries by volumes

  6. 6. MARKET SEGMENTATION

    1. 6.1 By Type of Payment

      1. 6.1.1 P2P

      2. 6.1.2 P2B

  7. 7. COMPETITIVE LANDSCAPE

    1. 7.1 Company Profiles

      1. 7.1.1 ACI Worldwide, Inc.

      2. 7.1.2 Mastercard Inc.

      3. 7.1.3 Finastra International GmbH

      4. 7.1.4 PayPal Holdings, Inc.

      5. 7.1.5 Fiserv, Inc.

      6. 7.1.6 Fidelity National Information Services, Inc. (FIS Inc.)

      7. 7.1.7 Wirecard AG

      8. 7.1.8 Worldpay, Inc.

      9. 7.1.9 Temenos AG

      10. 7.1.10 Visa Inc.

    2. *List Not Exhaustive
  8. 8. INVESTMENT ANALYSIS

  9. 9. FUTURE OUTLOOK OF THE MARKET

**Subject to Availability

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Frequently Asked Questions

The Germany Real Time Payments Market market is studied from 2020 - 2027.

The Germany Real Time Payments Market is growing at a CAGR of 31.5% over the next 5 years.

ACI Worldwide, Inc., Mastercard Inc., Finastra, Visa Inc., PayPal Holdings, Inc. are the major companies operating in Germany Real Time Payments Market.

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