High card-payment transaction costs are helping to keep the number of European vending machines that accept noncash payments low, Jürgen Göbel, chairman of European Vending Association’s cashless committee, tells PaymentsSource. The trade group represents 63 vending-machine companies and 20 national vending associations in Europe, where at least 3.8 million machines produced 2008 revenues of 13 billion euros (US$18.6 billion), the trade group says.
“Most vending machines accept cash only today,” says Göbel, who also is director, global product marketing unattended, at U.S.-based payment-terminal vendor Hypercom Corp.
Vending machines located in such public places as train stations and airports, however, sometimes can accept chip-enabled “electronic purse” cards, such as Germany’s GeldKarte. The card essentially is a debit card with a chip that stores preloaded funds. Transactions from such cards typically incur very low processing fees.
“We estimate that there are about 1,000 to 2,000 vending machines” in Europe that accept such cards, though “usage is quite low … because [consumers] either don’t want to or don’t understand why they should top up their cards in advance,” Göbel says.
However, “there are a number of trials currently being tested with vending machines that accept debit or credit card payments,” including efforts in Austria, Belgium and Switzerland, he adds. Still, “the current merchant or transaction costs for debit and credit cards are too high for [vending-machine] operators,” Göbel says. “Vending is a low-value payment [because] typical transaction values are below one or two euros.”
