The money passed “neither through Malian nor German hands”, according to diplomats in Mali on Thursday, speaking on condition of anonymity.
The freed hostages, from Germany, Switzerland and the Netherlands, returned home on Wednesday.
The money was paid to the abductors’ leader through an intermediary chosen by Tripoli, said diplomats, without naming the go-between or stating where or when the transactions occurred.
Malian President Amadou Toumani Toure had cited Libya as being among the countries that assisted in resolving the crisis when the nine Germans, four Swiss and one Dutch national were delivered to officials from their home countries at a ceremony on Tuesday in Bamako.
German Secretary of State for Foreign Affairs Juergen Chrobog did not mention Libya, thanking the governments of Algeria, Niger and Mali.
Saif al-Islam Qaddafi, a son of Libyan leader Moammer Qaddafi, was quoted earlier this week by a German daily as saying that Tripoli had intervened in the crisis through the Qaddafi Foundation, which he heads.
The Foundation also mediated in the freeing of European hostages held on the Philippines’ Jolo island three years ago.