Well Germany isn't really considered modern by northern EU standards, as would most northern EU citizens tell you. Don't know about Austria however.
There are also historical reasons why Germans are concerned about the possibility of being tracked, which apparently not everyone sees the dangers of.
This simply isn't true, outside of large chains or supermarkets. Many smaller businesses like pubs, "kiosks", barbers, non-chain restaurants, and so on, are cash only.
It's a combination of tax avoidance and trying to avoid the insane level of paperwork needed for bascically every aspect of life, but especially if you have a business, no matter how small.
Source: live in Germany, near a large metro area.
I have a different experience. I pay by card even for < 1 eur things almost everywhere (from time to time): sometimes I just have no cash with me anymore and I am totally ok. This has changed dramatically in the last 10 years, and I wish that the mainstream theme was different than "wooooow in Germany they still accept cash-only". Until now I only experienced this "cash-only" limitation in very few places.
My recommendation, though, is to always have some cash on you, especially if you don't know where you're going. But I would do the same in any other country in the world.
I meant: if you're not familiar with the place you're going to, or which way to take, etc.
Source: lived in Germany, at the outskirts of a large metro area, still visiting every few weeks to months into my own appartment, which I didn't abandon.
When it was time to pay, we were surprised to hear only local German cards were accepted. I couldn’t use Visa, Mastercard, anything. It never occurred to them to warn us. I had to walk around for 25 minutes on the hunt for an ATM to pay my due.
What was a nice lazy Sunday morning turned into an annoying time travel back into the early 90s.
Meanwhile, more and more places accept NFC payment.
You can also go cash-only in Austria, if you want to.
Austria is one of those rare places in the Free World where personal agency and responsibility are still, relatively, extant throughout society ..