Asylum Seeker Payment Card in Germany

The Bundestag voted in April 2024 to let authorities pay benefits under the Asylum Seekers Benefits Act onto a payment card, as JURIST reported. The government named its aims: less state money flowing to countries of origin, including payments to smugglers, and less cash handling in the municipalities. The card does not change the amount of the benefit, which the states set. It changes the payment instrument.

Whether the card is lawful in an individual case went to the social courts. In an interim proceeding, the Bavarian State Social Court held that the card and a cash limit of 50 euros a month do not violate the subsistence minimum, since the law lets the authority choose the form of the benefit at its discretion, and items a shop does not take by card can be paid from the monthly cash.

Fourteen states tendered the card together. The contract went to secupay AG, and each state orders cards from the framework agreement. Hamburg had already issued about 2,600 cards in its initial reception centers under the name SocialCard. According to IT Finanzmagazin, the SocialCard is a Visa debit card, physical and digital, built by a group of companies: Publk developed it, secupay handles issuing and payment processing, Visa provides the network, SAP runs the IT operations, Nortal rolls it out to the municipalities, and Giesecke+Devrient produces and personalizes the cards. Bavaria uses its own card, and Mecklenburg-Western Pomerania awarded its contract to Yoursafe.

Austria went a similar way. Seven Austrian states joined a tender of the Federal Procurement Agency that went to Paycenter, while Upper Austria tested the SocialCard of Publk.

The card pays like a debit card in shops in Germany. In Erlangen, holders can withdraw up to 50 euros per person and month at ATMs or shop checkouts. Each card carries an IBAN, so transfers and direct debits work, but only to recipients the authority has approved, such as electricity and phone providers, gyms and lawyers; a holder can ask for further accounts to be unlocked. Where a residence permit limits a person to one area, the card's area of use follows it.

Technically, the card is a balance-based card program whose rules sit in the issuer's software: a cash limit, a payee list and a regional limit, each switched on or off per state, as Hamburg's social authority explains. For that reason the rules differ from state to state.

Card issuing, prepaid programs and the rules for cash withdrawal belong to the Payments & Digital Money track at Finance Loop. The financial inclusion page covers the basic payment account that asylum seekers can also open, and the card payments page explains the debit card schemes in Germany.

A debit card onto which German authorities pay benefits under the Asylum Seekers Benefits Act. It replaces most cash payments: the holder pays in shops by card and withdraws a limited amount of cash.

JURIST reported a cap of 50 euros a month, and Erlangen applies 50 euros per person and month. The Bavarian State Social Court upheld that limit in an interim ruling.

secupay AG holds the framework agreement of 14 states, and the card runs on the Visa network. Bavaria and Mecklenburg-Western Pomerania use other providers.

Yes, to approved recipients. Each card has an IBAN, the authority keeps a list of payees such as utilities, phone providers and lawyers, and further accounts can be unlocked on request.