Overview of the latest changes to girocard and Maestro

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  1. Introduktion
  2. What’s the difference between girocards, debit cards, and credit cards?
  3. Why is Maestro being discontinued?
  4. How long will girocards with the Maestro function be valid?
  5. Impact of the Maestro discontinuation
  6. The future of girocard

girocard, colloquially referred to as the “EC card,” has been in use for the past 50 years. There are currently more than 100 million girocards in wallets across Germany, since German banks typically issue them automatically when customers open a checking account.

A major shift occurred on July 1, 2023, when card network Mastercard discontinued the Maestro payment system. Future girocards will not bear the Maestro cobrand. What will happen next, and how can customers pay instead—especially abroad?

What’s in this article?

  • What’s the difference between girocards, debit cards, and credit cards?
  • Why is Maestro being discontinued?
  • How long will girocards with the Maestro function be valid?
  • Impact of the Maestro discontinuation
  • The future of girocard

What’s the difference between girocards, debit cards, and credit cards?

Debit cards are a common type of payment card. girocard is a special type of debit card and the leading debit card in Germany. It’s targeted to the German market and offers a high level of security, data protection, and reliability. When customers use girocard or a debit card to make a purchase, their checking account is debited immediately and each transaction appears in their online banking platform.

When traveling abroad, customers often need to use credit cards for purchases such as hotel and rental car bookings. There are two types of credit cards: “charge cards” and “prepaid cards.” With charge cards, transactions are charged to the credit card account, customers are required to make a credit card payment once per month, and the card has a prearranged credit limit. Customers must “load” prepaid cards with money before making any purchases. Two of the best-known credit card networks are Mastercard and Visa.

You can find out more about the advantages of debit cards, credit cards, and other payment methods here.

Why is Maestro being discontinued?

Effective July 1, 2023, after 30 years of girocard payments being made through Maestro, newly issued girocards no longer have a Maestro function. Purchases and cash withdrawals abroad are now only possible with other payment methods, and girocard can be used without restrictions only in Germany.

Mastercard has justified its decision to discontinue Maestro by claiming that the payment system was not designed for online commerce and that costs were too high. In the future, Mastercard customers can use a Mastercard credit or debit card for purchases, instead of paying by direct debit. However, this means that online retailers would have to pay fees to Mastercard. This could also increase the share of debit and credit cards in the German market, as banks begin to replace girocards with alternatives such as Visa debit cards.

How long will girocards with the Maestro function be valid?

In the past, girocards with the Maestro symbol could be used abroad, and these payments were processed by Mastercard. As of July 1, 2023, these girocards are no longer being issued. However, old cards will remain valid until the end of their term, which will be the end of 2027 at the latest. Once the Maestro function no longer exists, customers must make purchases and withdraw money abroad using other payment methods.

Impact of the Maestro discontinuation

Some banks are offering other cards as an alternative to girocard. Experts believe that girocard issuers will increasingly rely on V Pay, another commonly used cobrand from Visa. However, V Pay focuses primarily on the European market. Most banks previously offered girocard with Mastercard or Visa cobrands. However, this meant that they had to pay double fees to the card issuer, first to girocard and then to either Mastercard or Visa. Customers can also pay abroad using a two-card system: one girocard for use within Germany, and another debit or credit card for use abroad.

If your company is interested in creating and managing a card program for your customers or employees, Stripe Issuing can help. Issuing gives you full control over spending limits and card design. The cards can be used for a variety of purposes—from expense management to order fulfillment.

The future of girocard

According to EURO Kartensysteme, a joint venture of German banks and savings banks, most banks want to continue issuing cobranded girocards if the customer had one before. An alternative cobrand—for example, V Pay—would still allow German customers to pay abroad. This means that only the logo on girocard would change. Another possible scenario is for banks to issue girocards with a debit function (i.e., a combination of girocard and a credit card).

However, customers should inquire about potential additional costs when they open an account or switch cards, as different banks take different approaches. For example, some banks charge an annual base fee for credit cards and additional fees for withdrawing small amounts or shopping outside of Europe. Some banks also charge interest until the balance is paid.

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