Card payment: Everything you need to know about cashless payment in retail.

In 2009, 59.1 percent [1] of retail payments were made in cash. Only 37.5 percent of goods and services were paid for with a card. 15 years later, the ratio has completely reversed. Today, 59.7 percent of retail customers pay by card and only 37.5 percent with coins or banknotes. Cashless payment has therefore also established itself in Germany and continues to gain popularity.

Cash or card payment: what difference does it make?

Most shopkeepers or entrepreneurs in the retail sector offer their customers cashless payment by card. This is actually surprising, as card payments incur a fee per transaction, depending on the card. This amounts to up to 0.3 percent of the invoice amount and goes to the respective card-issuing bank. The amount of the transaction fee therefore depends on whether the customer uses an EC card, debit card or credit card. However, you will also incur costs if the customer pays with cash. The cash often has to be counted and then taken to the bank. Particularly in rural areas, where the nearest bank branch is usually a long way away, this can take a lot of time and tie up staff.  

Do retailers have to accept cash?

Although cash is slowly going out of fashion, it is still a legal means of payment. So why do you see a sign saying "Card payment only" in many hairdressing salons, kiosks and decoration stores ? It's simple: legally, the customer can insist on paying with cash. As a retailer, however, you can get around this rule by clearly displaying a notice that you do not accept cash. The principle behind this is called "freedom of contract" and is also confirmed by the Bundesbank [2].

What types of cards are there?

"I would like to pay with a card." Which one exactly? This varies from customer to customer and the properties of the cards also differ. ‍

• Giro card: The giro card (formerly known as an EC card) is linked to a current account. It enables direct payments and cash withdrawals. Transactions are debited directly from the customer's linked account. This is a specifically German system that could also be used internationally via V Pay in Europe and Maestro until 2023.
• Debit card: When paying with a debit card, the money also flows directly from the current account on file - just like with a debit card. However, Mastercard and Visa debit cards can also be used to pay online - for example in an online store. This did not work with the old EC card. Further advantages are the high acceptance of this payment method and comparatively low transaction costs.
• Credit card: Credit cards can be used worldwide to make payments, withdraw money or for online shopping. The amount is not debited immediately, but usually after one month at the earliest. The user is also granted a certain credit limit. Disadvantages include the high fees for you as the business owner and the risk of payment defaults, albeit small.
• NFC payment: NFC payment enables contactless payment via smartphone or using a card at the payment terminal. This method is very secure, convenient and is becoming increasingly popular. One disadvantage is the limited transaction limits for contactless payment, although this only plays a minor role in retail.

Payment methods in retail  

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The advantages of a modern all-in-one checkout system

Card payments are not only convenient, but also secure. Especially if you have a digital all-in-one POS system like the one from LocaFox. Here, the card terminal is directly connected to your cash register. This makes incorrect entries or manipulation impossible and the payment process is automated and fast. What's more, thanks to our new payment partner Flatpay, you will no longer experience any nasty surprises when it comes to transaction fees. No matter which card your customers use - the fee always remains the same. Even for NFC payments! But that's not all. In future, payment and checkout in retail will become even more intuitive and flexible, because with LocaFox-Mini we are developing a mobile solution for retail that offers some exciting innovations.

LocaFox Mini: the mobile POS checkout for retailers

Whether sales, marketing or an stocktakingAs a retailer and store owner, you are a real all-rounder. We think so: Your POS should be at least as flexible. That's why we developed LocaFox Mini, a mobile POS cash register. The model is as handy as a smartphone, has an integrated scanner and can even print receipts. Simply hold your card up to the mobile cash register and pay. The ideal solution for anyone who wants to sell their products or services on the move in their own store. LocaFox-Mini can be used as a stand-alone system or as an additional cash register. We are currently putting the finishing touches to the solution. Until the system is released, we will keep you up to date via our newsletterand here on the website! By the way: If you register for LocaFox Mini now, you will receive an attractive early adapter discount!

Do you have questions about cashless payment in retail or would you like to find out more about our checkout system? We will be happy to advise you personally and look forward to your call or message.

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[1] https://de.statista.com/statistik/daten/studie/1129255/umfrage/umsatzanteil-zahlunsgarten-einzelhandel-in-deutschland/

[2] https://is.gd/Jd3lRU

[3] Deutsche Bundesbank Monthly Report

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