Germany plans mandatory digital payment options for retailers and restaurants by 2027

The proposed payment mandate

German Federal Finance Minister Lars Klingbeil released key policy points requiring physical retail shops, restaurants, and local service providers to offer at least one digital payment method starting in 2027. The proposal implements an agreement established in the federal coalition contract between the Union parties and the SPD. Under the framework, the Finance Ministry intends to submit a formal legislative bill to the cabinet before the end of 2026. Businesses will have the autonomy to select their preferred digital provider, provided that at least one European payment scheme is included in their offering. The planned legislation prohibits minimum spending thresholds and bans any additional surcharges on digital transactions.

“We want companies to offer a digital payment option wherever goods and services are paid for directly on site.”

Cash retention and regulatory exemptions

Cash acceptance will remain mandatory alongside electronic alternatives to preserve consumer choice at the point of sale. Specific exemptions are planned for non-commercial entities, including amateur sports clubs, charitable associations, flea markets, and village festivals. The ministry is also evaluating potential hardship provisions for small merchants facing technical barriers. Federal officials stated that expanding electronic payment acceptance supports efforts to counter tax evasion, money laundering, and financial crime by providing verifiable transaction records. Under current German commercial law, as outlined by attorney Christian Bereska, merchants are not obligated to offer card facilities and cash serves as the default legal standard.

Transaction costs and payment trends

Data from the Deutsche Bundesbank indicates that 55% of daily transactions in Germany were conducted without cash last year, with debit cards representing 26% and mobile or smartwatch payments accounting for 10%. While cash remains the lowest-cost method on an individual transaction basis at 0.43 euros, relative expenses invert when calculated against total business revenue. Girocard transactions generate the lowest relative cost for merchants at 0.8% of turnover, compared to 2.1% for debit cards, 2.3% for cash management, and 2.4% for credit cards. Research from the EHI Retail Institute shows that card payments generated 65.1% of German retail revenue last year, while cash accounted for 32.3%.

Cash0.43

Girocard0.6

Debit cards0.69

Credit cards1

Cash

0.43 €

Girocard

0.6 €

Debit cards

0.69 €

Credit cards

1 €

Data from the article text

Girocard0.8%

Debit cards2.1%

Cash2.3%

Credit cards2.4%

Girocard

0.8 %

Debit cards

2.1 %

Cash

2.3 %

Credit cards

2.4 %

Data from the article text

Industry reactions and consumer response

The German Retail Association expressed opposition to mandatory rules, arguing that legal requirements create unnecessary bureaucracy and impose additional operational costs on businesses. Ulrich Binnebößel of the association warned that card processing requirements complicate cashier operations and demanded legal allowances to pass transaction fees to consumers.

“Because a single acceptance always means that the entire range of cards must be accepted. Otherwise, complicated customer conversations arise that cause annoyance and cost time and money.”

The German Hotel and Restaurant Association called for transition periods and financial assistance for small and medium-sized hospitality operators. In contrast, Ramona Pop of the Federation of German Consumer Organisations welcomed the proposal, noting that consumers want the freedom to decide individually whether to settle payments via card, smartphone, or physical cash.