In cash-dominated Germany, Apple shops a prime target

BERLIN — If bandits rob banks because that is where the money is, then it makes sense to hold up an Apple Store in Germany on the day after a new iPhone is released — because that is where the cash is.

Late Saturday afternoon, with would-be iPhone buyers still queuing in front of Apple’s marble-and-glass emporium on Berlin’s Kurfuerstendamm, three masked gunmen stormed a security company’s van that was hauling away the pile of euros the store had taken in over the weekend.

One reason the outlet had so much cash on hand: Germans are famously behind much of the developed world in credit- and debit-card payments, with cash still used in more than half of money spent in stores.

The Apple Pay — a key feature of the iPhone 6 — will let customers shop in stores and online by tapping their finger on the phone’s fingerprint scanner rather than paying cash or swiping a card and presents an opportunity for Germans to move towards a cashless future.

Whereas Americans, Scandinavians and French can buy a cup of coffee or a pack of gum with a card, it is rare for Germans to use plastic for such payments and it can be hard to find a cafe or restaurant in Berlin, Munich or Frankfurt that will accept credit cards.

Only 15 per cent of retail payments in Germany are made by credit or debit card, the lowest among seven countries studied by the European Central Bank. While it is easy to use plastic at Apple’s Berlin store, it is not uncommon to see customers pay cash for iPhones or computers costing hundreds of euros.

Germans have already started moving — slowly — away from cash. They used cash for 53 per cent of the money they spent in stores in 2011, down from 58 per cent three years earlier, said Germany’s central bank, Bundesbank.

That change, though, will not accelerate unless German worries about privacy and data security are addressed, said Mr Richard Crone, founder of Crone Consulting, a mobile payments researcher in San Francisco.

And those concerns give digital payment systems, such as Apple Pay, an advantage, he said. The technology does not reveal a customer’s identity or payment information to the vendor, which means shoppers face less risk from security breaches.

“You cannot get rid of this risk until you get rid of the card,” said Mr Crone. BLOOMBERG