German banks launch PayPal rival Paydirekt

German banks have launched Paydirekt, which aims to be a competitor to PayPal. The online payment system is an initiative of several major banks in Germany. Paydirekt follows after many banks complained about the dominance of PayPal and were struggling to come up with a German answer to it.

The website of Paydirekt is already online, but the payment system itself will be fully operating at the end of this year. On the homepage, it reads: “Those who shop online, can pay securely and directly from their bank account with Paydirekt by the end of 2015.”

It follows strict German laws and regulations
The banks call paying online with Paydirekt “as natural as paying with your own bank account”. It ensures consumers can pay easily and directly online, without any third party involved.  Paydirekt is integrated into the systems of the participating banks and saving banks and follows the strict requirements from the German banking industry. “As a Germany company, Paydirekt is subject to the German law and data protection regulations, which are globally regarded as particularly strict.”

The banks believe trust, speed, security and buyer protection are the main benefits of using Paydirekt. It also tells foreign consumers will be able to use Paydirekt, provided they have a bank account with online access at one of the participating banks or financial instutions as well as an e-mail address.

Paydirekt for online sellers
For sellers, it could be a benefit the payment solution is made in Germany. Consumers could be more receptive towards a local payment method rather than an American or other foreign player. Also, it offers an immediate payment guarantee, a simple interface, easy connection via payment service providers and standard plugins, high transaction security, age verification and authentication for buyers, potentially access to new customer groups.

About Paydirekt
Paydirekt is an industry-wide cooperation between the German private and cooperative banks and the savings banks. The Android and iOS apps are already downloadable.