Germany: Refugee Payment Card Dispute Reignites After Partial Launch

Following the introduction of payment cards for refugees in select regions, a renewed debate has emerged regarding their statewide implementation. Certain areas have reported that the introduction of these cards prompted asylum seekers to consider either leaving Germany or pursuing employment opportunities. Nevertheless, the true implications of this model remain a subject of contention.

Werner Henning, director of the Eichsfeld region, specified that 56 asylum seekers returned to their home countries in Georgia and the Western Balkans, while another 43 joined the workforce. Martina Schweinsberg views these trends as early signs of success in implementing the payment card system.

On the other hand, Mirjam Kruppa, the State Commissioner for Integration, Migration, and Refugees in Thuringia, asserted, “In the ongoing discourse surrounding the refugee payment card, recurrent arguments are being put forth, many of which are either erroneous or lacking in foundation.”

Kruppa argues that the departure of certain asylum seekers or their engagement in employment cannot be directly attributed to the implementation of the payment card, as many asylum seekers are already motivated to seek employment. She criticized Andreas Bausewein, Mayor of Erfurt, for asserting that there is a migration trend among asylum seekers from areas where the payment card has been introduced, describing this claim as inaccurate, given that all asylum seekers or individuals with residency obligations possess payment cards.

Regarding immigration specialists, Herbert Brücker, Head of the Research Department for Migration, Integration, and International Labour Studies at IAB, does not believe that the payment card will have permanent positive effects on the districts. Compared to bank transfers, the payment card involves numerous procedures, such as signing contracts with the financial service provider issuing the card, determining the fees paid, and signing contracts with supermarket chains in case of exchanging in-kind benefits for the card.

Critics of the payment card contend that increased restrictions on payment options result in more administrative hurdles. There is concern that the implementation of the payment card may incur indirect expenses, limit mobility, impede integration efforts, complicate employment prospects, and deprive asylum seekers of access to certain goods and services.

The Refugee Council of Thuringia agrees with migration researchers, believing that there are many restrictions on asylum seekers accessing some services, such as hairdressers, small shops, or buying tickets. Accredited merchants can increase prices in cases of local monopolies using the payment card. Brücker believes that these indirect negative effects should be seriously considered in the assessment, despite being difficult to measure.

Estimates of the amount of money transferred to asylum seekers’ home countries are exaggerated. He cites data from the German Central Bank (Deutsche Bundesbank), which shows that 829 million euros were transferred to the top eight original nations in 2023, according to Brücker. There are indications that most of the transferred amounts came from immigrants working regularly in Germany, and the transfers represent 5% of employee wages. Additionally, the available amounts for asylum seekers are very low, so they cannot be diverted to smugglers.

According to Brücker, funds are typically transferred to families in their home countries, bypassing traditional money transfer channels. Smugglers often receive their payments upfront rather than through formal transfers. These remittances to families and acquaintances serve to cover living expenses, healthcare, and educational costs, thereby alleviating migration pressures and enhancing local living standards.

According to the recently published study, 25% of respondents expressed interest in seeking employment abroad, while 60% indicated a willingness to relocate for work opportunities. The study unveiled a relative decrease in the allure of German job prospects, which previously held the second position until 2018, thus marking a decline of three positions in the global ranking of desirable work destinations.

Only 7% of the 14,000 German respondents to the study said they were looking for employment overseas, which shows how stable the labor market is in Germany for both native and immigrant workers. In comparison to Italy and Britain, where the percentage of job seekers overseas is more than double that of Germany, this number is low.

Africans have the strongest desire to find work abroad, with Ghanaians leading the pack at 74%, followed by India (54%) and Turkey (35%). This trend is particularly pronounced among highly educated individuals. The study focused on academics, whose migration aspirations may differ from those of the broader workforce.

London reigns as the world’s most popular city, eclipsing Amsterdam and Dubai in the study, while Berlin secures its position as one of the premier work destinations, ranking sixth. As per the study’s authors, the appeal of employment opportunities stands as the pivotal factor in deciding to relocate, outweighing considerations of specific countries or cities.

In terms of competition among companies seeking skilled labor from abroad, attractive working conditions and organizational support are the factors for winning skilled labor. According to Jens Bayer, a consultant at the “BCG” group, Germany has declined in the ranking of countries attracting skilled workers due to the difficulty of obtaining work permits, which is extremely challenging in Germany.

The German Association of Towns and Municipalities called in September last year for faster work permits for asylum seekers if they have a chance of asylum acceptance, as work can aid in integration. Additionally, since the labor market in Germany needs skilled workers, representatives of the Traffic Signals Alliance called for enabling refugees to access the labor market more quickly.


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