Giropay was an Internet payment system in Germany, based on

online banking Online banking, also known as internet banking, virtual banking, web banking or home banking, is a system that enables customers of a bank or other financial institution to conduct a range of financial transactions through the financial institut ...

. Introduced in February 2006, this payment method allowed customers to buy securely on the Internet using direct online transfers from their bank account. The system was similar to the Dutch

iDEAL Ideal may refer to: Philosophy * Ideal (ethics), values that one actively pursues as goals * Platonic ideal, a philosophical idea of trueness of form, associated with Plato Mathematics * Ideal (ring theory), special subsets of a ring considered ...

payment system, MyBank payment system, the

Interac Interac is a Canadian interbank network that links financial institutions and other enterprises for the purpose of exchanging electronic financial transactions. Interac serves as the Canadian debit card system and the predominant funds transf ...

online service in Canada
pagomiscuentas
payment service in Argentina, and Secure Vault Payments in the

United States The United States of America (USA), also known as the United States (U.S.) or America, is a country primarily located in North America. It is a federal republic of 50 U.S. state, states and a federal capital district, Washington, D.C. The 48 ...

. Giropay was owned by giropay

GmbH (; ) is a type of Juridical person, legal entity in German-speaking countries. It is equivalent to a (Sàrl) in the Romandy, French-speaking region of Switzerland and to a (Sagl) in the Ticino, Italian-speaking region of Switzerland. It is a ...

until December 2020, when it was acquired by . The two began a merger in May 2021. On 1 July 2024 paydirekt announced that the Giropay service will be shut down on 31 December 2024. Some payment providers stopped the service on 30 June 2024. As decided, Giropay was finally discontinued on 31 December 2024. Paydirekt recommends the European payment service

Wero WERO (93.3 FM, "Bob 93-3") is a contemporary hit radio music formatted radio station for Eastern North Carolina licensed to Washington, North Carolina, US, targeting the Greenville, North Carolina, and Eastern North Carolina areas. History T ...

as its successor.

Transaction volume

By May 2007, more than 100 million euro in purchases had been made.''Explanation of Payment Systems'', PDF document distributed by NetBanx In 2008, the system processed 3.2 million transfers, with the transactions made totalling 185 million Euros. Over one million such transactions are processed every month.

Scope

Most German Sparkassen and cooperative banks are participating in Giropay. However, the number of participating banks from the

private sector The private sector is the part of the economy which is owned by private groups, usually as a means of establishment for profit or non profit, rather than being owned by the government. Employment The private sector employs most of the workfo ...

is limited. In this sector, the major participating banks are

Deutsche Bank Deutsche Bank AG (, ) is a Germany, German multinational Investment banking, investment bank and financial services company headquartered in Frankfurt, Germany, and dual-listed on the Frankfurt Stock Exchange and the New York Stock Exchange. ...

Deutsche Postbank Postbank (; full name: Postbank – eine Niederlassung der Deutsche Bank Aktiengesellschaft, ) is a branch of Deutsche Bank for retail banking, which was formed from the demerger of the postal savings division of Deutsche Bundespost in 1990. Si ...

Commerzbank The Commerzbank Aktiengesellschaft (shortly known as Commerzbank AG or Commerzbank ) is a European Financial institution, banking institution headquartered in Frankfurt am Main, Hesse, Germany. It offers services to private and entrepreneurial c ...

and

Comdirect Bank Comdirect Bank Aktiengesellschaft was the third-largest Germany, German direct bank and was based in Quickborn, Schleswig-Holstein. Founded by the Commerzbank in 1994, the company went public in 2000. The Commerzbank integrated the company on Nov ...

. Nevertheless, Giropay has a reach of about 17 million German online banking customers, and about 60% of all commercial bank accounts. That number means the participating banks are serving the vast majority of the German online banking market.

Process

Giropay offers merchants a real-time payment method (publicized as virtually risk-free) to accept internet payments. For customers, Giropay uses the same environment as their banks' online banking sites. The level of security depends on the participating bank. Some German Banks offer

two-factor authentication Multi-factor authentication (MFA; two-factor authentication, or 2FA) is an electronic authentication method in which a user is granted access to a website or Application software, application only after successfully presenting two or more distin ...

(2FA), such as a challenge–response

access token In computer systems, an access token contains the security credentials for a login session and identifies the user, the user's groups, the user's privileges, and, in some cases, a particular application. In some instances, one may be asked to ente ...

based on the chip embedded in the

debit card A debit card, also known as a check card or bank card, is a payment card that can be used in place of cash to make purchases. The card usually consists of the bank's name, a card number, the cardholder's name, and an expiration date, on either ...

or ATM card. Others, however, offer simpler

PIN A pin is a device, typically pointed, used for fastening objects or fabrics together. Pins can have the following sorts of body: *a shaft of a rigid inflexible material meant to be inserted in a slot, groove, or hole (as with pivots, hinges, an ...

and TAN based online banking services. No sensitive information is being shared with the merchant, such as credit card or Giro account numbers. There is no

chargeback A chargeback is a return of money to a Payment, payer of a transaction, especially a credit card transaction. Most commonly the payer is a consumer. The chargeback reverses a Electronic funds transfer, money transfer from the consumer's bank acc ...

right however, which can be considered a disadvantage for the consumer using this payment method. This is considered an advantage to the merchants.{{Cite web , title=What are Giropay and Sofort? – A detailed guide for business owners , url=https://paymentsplugin.com/blog/giropay-sofort , access-date=2023-02-12 , website=paymentsplugin.com , date=26 November 2022 , language=en Giropay works as follows: # Merchant offers Giropay as payment method, often in addition to the regular credit card payment options # Consumer selects Giropay and selects their bank # Consumer is redirected to their bank's login page # Participating bank displays transaction data # Customer enters account number, PIN, and either: ## A remittance slip is sent to the customer for confirming the transaction, containing a TAN (transaction number). The customer enters this number to confirm the transaction. ## The customer signs the transaction digitally using a

2FA Multi-factor authentication (MFA; two-factor authentication, or 2FA) is an electronic authentication method in which a user is granted access to a website or application only after successfully presenting two or more distinct types of evidence ...

token (if their bank offers that service) # Bank authorizes transaction in real-time, deducting the amount directly from the consumer's account (if there is not enough balance, the transaction will be refused) # Merchant received real-time confirmation of the payment by the bank # Consumer is redirected back to the merchant page with a confirmation that the payment has been successful Payments are guaranteed for amounts up to 5000 euros.

Costs

Costs are calculated on a per-transaction basis and decrease with transaction volume or value. The NetBanx payment gateway quotes figures from 1.2% to 0.9%, plus 0.08 € per transaction.

References

E-commerce in Germany Payment service providers Online banking Banking in Germany

Transaction volume

Scope

Process

Costs

See also

References