The payment preferences of German consumers and the future of BNPL in the country

Thursday 9 November 2023 08:00 CET | Editor: Raluca Ochiana | Interview

Nina Pütz, CEO at Ratepay, shares the story of the company and offers a glimpse into the preferences of German consumers when it comes to BNPL services.


Can you tell us a little bit more about Ratepay and its journey into becoming one of the most prominent BNPL solution providers?

Ratepay’s journey began in 2009, during a time when terms like invoice payments were relatively new and unexplored in ecommerce. The concept of providing downstream payment solutions for online stores was born when Miriam Wohlfarth, the founder of Ratepay, identified a pressing need for such solutions among her merchant clients. Thus, she started Ratepay, and soon partnered with Otto for the financial support needed to grow the business.

Ratepay grew into success primarily because of two important factors: first, its white-label integration, and second, a top-notch risk management system. The white-label invoice option was especially popular with the careful German shoppers who love using familiar terms like Rechnungskauf (invoice payment) instead of new, unfamiliar brands. The payment guarantee that Ratepay offers to merchants creates the necessary trust among merchants to work with the company.

As the online payment landscape evolved with the emergence of Buy Now, Pay Later (BNPL) as a popular payment method and the entry of international competitors into the market, Ratepay continued to thrive. Today, Ratepay is an integral part of the Italian payment provider Nexi – and boasts a diverse clientele, including prominent names like PayPal, IKEA, and Fashionette. Furthermore, the company has benefited significantly from the surge in online shopping driven by the COVID-19 crisis and the growing popularity of BNPL.

While forthcoming regulations are expected to introduce more stringent controls in the BNPL sector, Ratepay, as a German-regulated entity, has already established the necessary infrastructure to comply with the new standards and capitalise on the ongoing BNPL trend.

How does Ratepay differentiate from other BNPL providers and how does its white-label solution help both partnering merchants and end-consumers?

Ratepay stands as Europe’s premier white-label payment provider, overseeing all aspects, from payment processing to customer service, and risk management behind the scenes. Our primary objective is to support the growth of our clients, with Ratepay benefiting as their revenue increases.

Our flexible features and modular system allow us to tailor our offerings to meet the unique requirements and business models of each individual merchant. Through our one-partner concept, retailers maintain complete oversight and control, handling tasks such as contract signing, onboarding, and payouts in their established merchant relationships.

Moreover, the white-label solution has emerged as a significant driver in building customer loyalty. Online retailers offering this payment option are greatly preferred by customers, especially when employing white-label solutions. Throughout the checkout process, customers stay within the online store’s branded ecosystem, creating a direct association between financial security and the brand. All transactions take place seamlessly within the merchant’s platform, devoid of third-party involvement or redirection to external websites, delivering a seamless and dependable shopping experience to customers

What are the payment preferences for the German market and, more specifically, the preferences regarding BNPL products? 

Efficiency, security, and speed are considered cornerstones that online payment methods must fulfil to cater to the preferences of German consumers, and BNPL payment methods hit the mark perfectly. While e-wallets lead the pack with a commanding 45% usage rate, the BNPL services, particularly Invoice Payment, come in second place at an impressive 38%, followed closely by direct debit, with a usage share of 27%. Instalment payments exhibit a somewhat more modest adoption rate, comprising 8%

Additionally, it is worth noting that PayPal enjoys a prominent presence in the German online payment landscape, commanding a usage rate of nearly 29.6%, while credit card payments account for 12.1% of the market. These figures underscore the diverse range of payment methods preferred by German consumers. 

How do you see the future of BNPL in the country in terms of regulations? Will BNPL continue to remain a preferred payment method for consumers? 

Tightening credit checks is a prudent move, particularly in the current economic climate where inflation and the risk of individuals falling into forced debt are on the rise. Many industry experts argue that EU regulations primarily favour banks. 

However, we remain reluctant that anything will change in terms of the use and general popularity of BNPL options. The real challenge lies with international players such as Klarna, Revolut, and Apple, who have not been subject to regulations thus far. Adapting to the new regulations will pose a formidable challenge for them. As a German-based player, Ratepay has a clear competitive advantage in this regard. 

It is important to note that the directive has been enacted at the EU level and must now be incorporated into national law. How exactly the directive will be translated into national law and, above all, by when is something we cannot yet say. 

Finally, how do you see the development of Ratepay in the upcoming years? What’s new in store for the company? 

The BNPL market boasted a substantial size of around USD 120 billion in 2021 and represented 1% of global point-of-sale (POS) payments during that year. Notably, Sweden and Germany emerged as frontrunners in BNPL adoption. In 2022, BNPL services were embraced by a staggering 360 million individuals worldwide. Given the immense scale of this market, we are committed to maintaining our leadership position, particularly in the DACH region. 

To achieve this goal, we underwent significant transformations over the last few years, implementing process enhancements and bolstering our team with a wealth of international and highly experienced talent.

This editorial piece was first published in the Payment Methods Report 2023, which provides an in-depth overview of the latest worldwide developments in how people pay, the payment methods space, the innovative technologies that these methods work upon, and the best strategies on how to win at conversion and retention.

About Nina Pütz 

Nina Pütz is the CEO of Ratepay. With more than 17 years of experience in ecommerce, Nina was most recently CEO of the online shopping club brands4friends and spent 15 years in various leadership roles at the online marketplace eBay. She is also involved in the advisory board of the textile trading company L&T and a member of the supervisory board at international rescue committee (IRC) Germany.



About Ratepay

Ratepay operates in financial services as a direct provider of white-labelled Buy Now, Pay Later (BNPL) products in Germany, Austria, Switzerland, and the Netherlands. The company enables large online retailers (merchants and marketplaces such as eBay, IKEA, Eurowings, Flyeralarm, or About You) to offer end-customers (buyers) the possibility to pay for products or services via open invoice, direct debit, or in instalments. Being natively integrated at checkout, Ratepay is invisible to the buyers and does not dilute the merchant’s brand and trustworthiness.

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Keywords: payment methods, local payment method, BNPL, merchants, ecommerce, Ecommerce Europe, regulation
Categories: Payments & Commerce
Companies: Ratepay
Countries: World
This article is part of category

Payments & Commerce


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