What you need to know about giropay

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  1. Introduction
  2. What is giropay?
  3. What are the advantages of giropay?
  4. How does giropay work?
  5. How does giropay differ from Sofort payments?
  6. Is giropay widely accepted?
  7. How can customers pay with giropay in shops?
  8. How much does giropay cost for businesses?

giropay is a popular cashless payment method used in stores and online. This article explains what giropay is, how it works and how much it costs businesses to use it.

What's in this article?

  • What is giropay?
  • What are the advantages of giropay?
  • How does giropay work?
  • How does giropay differ from Sofort payments?
  • Is giropay widely accepted?
  • How can customers pay with giropay at the POS?
  • How much does giropay cost for businesses?

What is giropay?

giropay is a fast, easy and secure payment method that enables customers to make payments directly from their bank account either online or in shops. It is supported by more than 1,500 banks across Germany and can be used by individuals and businesses. giropay GmbH was established in 2005 and was acquired by Paydirekt GmbH in 2020.

What are the advantages of giropay?

giropay is widely accepted in Germany. Many customers are already familiar with giropay, and a number of banks offer it as a payment method for use online as well as in brick-and-mortar shops.

As giropay allows businesses to receive payment confirmation immediately, payments can be processed quickly and goods can be delivered straight away, which increases customer satisfaction. The transaction process is also very simple and fast – transactions can be completed in less than 10 seconds – as authorisation by the customer takes place directly at the bank.

Another advantage is that the transaction costs are very reasonable compared with other payment methods, which can offer a considerable saving, especially for businesses with a high turnover. There is also no risk of uncovered direct debits or chargebacks, as payments are confirmed immediately.

giropay is also extremely secure. All transactions take place over an encrypted connection, so personal information remains protected and fraud is minimised.

How does giropay work?

With giropay, customers can pay directly via their online banking account at a participating bank, without having to log in to an external website. To do so, they select giropay as the payment method during the checkout process and are then redirected to their bank's online banking page automatically. After entering the information and confirming the payment, a payment confirmation is sent to the business immediately.

Each transaction requires the customer to enter their online banking password, and no sensitive banking information is shared with the business. Because giropay is linked directly to the customer's account, the payment amount can be retrieved immediately and is credited to the relevant business account the next banking day. In addition, giropay's privacy policy ensures compliance with the applicable data protection regulations and protects customers' privacy.

How does giropay differ from Sofort payments?

Sofort payments are another popular payment method in Europe. For both payment methods, a payment confirmation is sent to the business immediately after the transaction. However, Sofort payments differ from giropay because the payment process takes place directly in a page hosted by Klarna. This means that you also have to share login data, account data and your PIN or TAN with Klarna. Sofort payments are possible with any bank account, whereas with giropay, the customer's account must also support this payment method.

Is giropay widely accepted?

Most German banks now offer their customers the option of paying with giropay, and many other European countries now accept giropay as a payment method as well.

Numerous online shops and platforms are now offering giropay, and it is easy for businesses to use giropay on major e-commerce platforms, such as Amazon or eBay. Many online games and streaming services now accept giropay as a payment method as well.

How can customers pay with giropay in shops?

giropay can also be used in brick-and-mortar shops to simplify the payment process. Customers can pay with ease, using their smartphone or tablet without having to carry cash or a card.

To offer giropay in a shop, the business needs a corresponding app which allows customers to scan the amount using a QR code and pay directly from their current account. The process is very quick and simple for the customer, while the business benefits from fast and secure payment processing and a smaller administrative overhead.

Furthermore, integrating giropay into the shop offers the opportunity for targeted customer retention. For example, the app can be used to offer discounts or special promotions to encourage customers to use giropay.

How much does giropay cost for businesses?

giropay is a pay-per-use service, so the business only pays fees for actual sales made using the platform. This is especially beneficial for smaller businesses, as they are not paying for services that they may not need or use.

The costs usually consist of a fixed amount and a variable percentage based on the transaction amount. The exact transaction costs are agreed individually with your bank to ensure fair and transparent billing for businesses.

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