Payment issue in Germany, according to PayPal, has been effectively addressed and services are now functioning normally.
In a statement, PayPal has confirmed that a security issue with their direct debit system has caused major payment delays in Germany. The incident, which was first reported by Sueddeutsche Zeitung and other German media, has resulted in some retailers not receiving payments and some customers being advised that their PayPal wallet balances were in the red.
PayPal, which holds approximately 30% of the total online purchase market in Germany, making it the leading online payment provider, is working with bank partners to address any discrepancies in consumers' accounts. The German banks that temporarily stopped payments to PayPal due to the security incident include Bayerische Landesbank, Hessische Landesbank, and DZ Bank; these banks halted transactions amounting to over 10 billion euros as a precaution following PayPal's failure in their fraud detection system in August 2025.
The issue has been resolved, as stated by PayPal, and all legitimate transactions for merchants will be honoured in full. The US company has also apologised for the inconvenience caused by this event.
Ramona Pop, a representative from consumer rights group VZBZ, expressed concern over the unsettling PayPal messages. The incident, she said, underscores the dependence on US payment service providers. The group argues for the need for more European alternatives in the online payment market.
Interestingly, a new preference for card payments over cash is emerging in Germany, as suggested by the title "Card over cash? Why Germany is seeing a new payment preference." This additional fact, however, is not directly related to the PayPal issue and may not be relevant to the bullet points provided.
As the incident unfolds, PayPal continues to prioritise safety and security, reaffirming their commitment to protecting their users' financial information.
