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The payment card for asylum seekers: Political considerations and social stigmatisation

Updated: May 15

Few topics have fuelled the German migration policy debate in recent months as much as the so-called "payment card". In our latest advocacy blog, we explain what the payment card actually is, the political rationale behind it and what the introduction of the payment card means for asylum seekers themselves.


The payment card that Germany is introducing for refugees and asylum seekers is a highly controversial topic. While the Government is touting the alleged benefits of a “Bezahlkarte”, asylum and human rights organisations as well as experts in the field of migration, are expressing doubts and concerns.

Omar Alkadamani, who is working with the organisation Migranos Movement which provides aid and guidance for refugees and asylum seekers, belongs to the second group. When we spoke to him about the payment card and the potential impacts of  its introduction, he expressed several concerns and a general uncertainty about what to expect in the months to come.

In order to create a uniform legal framework for the introduction of the payment card, the German government agreed on an amendment to the Asylum Seekers’ Benefits Act, which was passed on April 26, 2024, after the German Bundestag (parliament) and Bundesrat (federal council) had given their approval. This amendment provides for the establishment of a payment card without a bank account, to which refugees and asylum seekers are to receive a monthly contribution. The exact implementation of the payment card is left to the respective federal states. Refugees and asylum seekers are to receive the same amount they received before, which is 460€ or 413€  if accommodated in a shared accommodation. Due to the payment card, this amount of money is subject to several new conditions such as it can only be used within Germany, no bank transfers are possible and only a maximum of €50 or less can be withdrawn in cash – depending on the respective federal state’s regulations.

Much is still uncertain and therefore everything written here is subject to change.

Political background and critical voices

Refugees seeking protection in Germany who are unable to support themselves are entitled to benefits in accordance with the Asylum Seekers Benefits Act. These benefits are paid out in the form of cash or vouchers. In the future, refugees will receive these financial benefits via a so-called “payment card”. This was agreed upon by the Conference of Minister Presidents and the Federal Government, whereupon the Federal Cabinet also approved an amendment to the law on 1 March 2024. The Ampel has now also agreed on a nationwide legal basis. Critically, this affects people who have applied for asylum but whose application is still being processed or has already been rejected, and who have made use of the tolerated status (Section 1 AsylbLG). 

While the payment card is intended to reduce administrative work, the restricted use of the card is simultaneously intended to prevent remittances to the countries of origin. Another argument is that Germany should become less attractive to refugees. The populist narrative that refugees receive generous social benefits and are favoured in other areas can be found in the demand to limit spending through a payment card. “We are stopping online shopping, gambling and transfers abroad. Cash will only be available as small pocket money up to 50 euros," said the Bavarian Minister President, Markus Söder, in favour of introducing the payment card. Anti-immigration rhetoric is increasingly being fuelled by politicians from democratic parties and shows the questionable course of politics in dealing with refugees. 

There are also critical voices from the political sphere. Reem Alabali-Radovan, the federal government's migration commissioner, voiced concerns regarding the transition to payment cards, stating that it was unacceptable for individuals to be identified as refugees through their use. Additionally, the Brandenburg Nonnenmacher department justified its veto against a 50-euro pocket money by emphasising their ongoing advocacy for a humane existence for refugees.

First and foremost, the extent to which the payment card makes the administration's work more efficient should be examined. According to studies by the German Institute for Economic Research and the DeZIM Institute, the planned changeover to cash payments is associated with higher costs and burdens on the social system. In addition, data from the German Bundesbank's balance of payments statistics show that the volume of remittances is rather low. 

The negative effects on integration and participation result from the restriction of benefits that secure livelihoods and can immensely limit the opportunity for mobility, communication and socio-cultural participation. Whether these negative effects will occur to a greater extent depends on the design of the payment card. The more the payment card resembles a general means of payment such as a credit or cheque card, the lower the expected negative effects will be. This will depend on how it is implemented by the federal states and local authorities.  

Interview with Omar Alkadamani

As a volunteer of the organisation Migranos Movement, Omar Alkadamani is in constant contact with refugees and asylum seekers, advises them on legal and social matters and does educational work for society on the topics of flight and asylum. For some months his work also includes the payment card. As the payment card has only recently been introduced and only in some municipalities, there has so far been little feedback and personal insights from those who now have to use it. However, Omar has a number of concerns about the payment card, ranging from impractical to discriminatory.

First of all, Omar points out that the legal framework for the payment card is quite vague, and leaves a lot of room for change, which leads to a high degree of insecurity and uncertainty for those affected as well as organisations that provide advice and assistance on the issue. For example, each federal state could set a different maximum amount  for monthly cash withdrawals with a nationwide binding maximum amount of 50€. According to Omar, the maximum amount of 50€ is already quite low, as many services and goods from shopping facilities in Germany are only offered for cash, e.g. many hairdressers, second-hand stores, or flea markets. Especially the restricted access to cheaper and second-hand goods could in turn lead to refugees and asylum seekers having to buy new and comparatively more expensive goods and consequently no longer being able to save money in this area. 

As Omar goes on to explain, it is also not yet clear where the payment card can be used and whether it is compatible with standard EC-card readers. If this is not the case, the options for where those affected can purchase goods or services will be further restricted. 

The fact that the payment card cannot be used to make bank transfers is another significant restriction. Due to the payment card, it will be much more complicated to, for example, pay for a sports club or take out a cell phone contract. While it is still possible to buy prepaid SIM cards or pay for memberships in cash, the procedures involved are much more complicated. Moreover, Omar adds, it will be difficult to pay the fees for a lawyer when it comes to asylum matters.

In addition to the restrictiveness and inconvenience that presumably come with it, Omar emphasises the discrimination factor of the payment card. Although the degree of discrimination through the payment card varies depending on its respective design, it is generally a unique feature that separates refugees and asylum seekers from the rest of German society. It remains to be seen whether the payment card will be externally recognizable as such, or whether an inconspicuous design will be chosen that resembles a debit or credit card. However, many current designs feature the term ‘Bezahlkarte’ or ‘Bezahl Karte’ (payment card), so that it can be  determined whether someone is using a debit or credit card or the payment card. In this context, Omar expresses concerns that people who have to use the payment card could be insulted or attacked if they are seen using the card, as it clearly identifies them as refugees or asylum seekers. In the current times, when attacks on politicians and asylum seekers are on the rise, this is particularly troublesome, adds Omar. 

Omar goes on to say that he finds it problematic that the payment card is being imposed on a group of people who already have little agency and influence over their position within German society, with many of them having experienced terrible situations and constant fear both in their countries of origin and on their escape routes. Imposing such divisive measures as the payment card sends the wrong signals and gives the impression of not being welcome in a country that should be a safe haven. Omar also fears that the payment card could be extended to people with a residence permit or other residence status that does not constitute full citizenship. He also suspects that political calculation played a role in the decision in favour of the payment card, as political parties from the opposition such as the AfD (Alternative für Deutschland) or CDU (Christian Democratic Union) are increasingly using anti-immigrant rhetoric, even though the right to asylum is enshrined in the EU Charter of Fundamental Rights.

In conclusion, Omar notes that much is still uncertain about the payment card, but the concept itself is already a discriminatory system that clearly interferes with people's financial self-determination. He is also sceptical as to whether the introduction will actually be beneficial for Germany, as the official justifications for the payment card are partly based on speculation and unproven claims – such as lower administrative burdens or a reduction in pull factors.

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