The image of the worthless Reichmarks actually is associated more with the initial hyperinflation of the Early Weimar Republic, in the years of 1922-1923. During WW1 the German government actually financed the war by borrowing money, hoping that in winning the war they could impose large war reparations on their defeated foes. The strategy backfired when Germany lost WW1. To top it off, they now had to pay large war reparations imposed upon them in the Treaty of Versailles. Saddled with debt and lacking the economic power to pay it off, Germany was in a dangerous situation.

Things took a turn for the worse during the Ruhr occupation. Unable to pay off the war reparation, French and Belgian soldiers invaded the Ruhr area and occupied it in 1923, taking over industrial areas. The Weimar government ordered the workers to go on a general strike and passively resist the occupation. However this had devastating consequences, as German productivity plummeted even further. To help stop the German economy tanking, and feed the striking workers, they turned to printing more paper marks to buy foreign currency. But this had even more detrimental effects, in effect devaluing paper marks. At some points inflation which a whopping 250000%, making the Reichsmarks next to useless. The popular images of people carting wheelbarrows of money around and street cleaners sweeping money away is mostly from this era (some linked pictures if you are interested)

The German economy eventually recovered in 1924, thanks to issuing a new currency (the Rentenmark) as well as taking lots of short term loans from America, but memory of the bitter harsh times remained.

Now on to the Great Depression. Germany probably suffered more than other European countries due to the aforementioned reason: they had taken lots of short term loans from the United States. German enterprise borrowed large sums of money and allowed American companies to set up shop on their soil, and German banks took their own foreign loans to invest in German business.

However throughout 1928, recession loomed and industrialised countries began to impose monetary restrictions up to and including restrictions on lending and preserving gold reserves. German industry began to stagnate and slow.

Then when the Great Depression hit, the New York Stock Exchange crashed along with thousands of American businesses. American banks began calling for immediate repayment of the many short term loans they had issued to the German firms. This had an effect of destablising the economy and causing investors to pull out of the Germany, adding to the cascade effect. No longer able to finance production German firms cut back drastically and unemployment spiked. banks also began to get into huge difficulties, with many closing down and the major banks falling under severe pressure.

By 1932 about 1 in 3 German workers were now registered as unemployed. Unemployment in Berlin rose from 130000 to 600000. The true numbers were probably even higher, as not all workers were registered and the unregistered ones were also similarly hit by the Depression. Here is a picture of the huge queues of unemployed waiting for bread and milk. Hard times and starvation were ubiquitous everywhere.

Not only that, but the newly appointed Chancellor of Germany, Heinrich Bruning began austerity measures, drastically cutting government expenditure and reducing social benefits for workers. This lead to even more misery for the working class and allowed seeds of radical ideas to foment and take root in the population.

To sum it up, yes, the economic collapse in Germany during the Great Depression was immense, and affected it severely, and moreso than other European countries due to its large debt owed to the United States and prior deep seated issues with its own economy (although other countries like Poland were also hit very badly)

Source: most of it actually comes from Chapter 4 of Richard J Evan's The Coming of the Third Reich