Can your French bank now take some of your savings?

[NormanH]

if it gets into difficulties..

It happened in Cyprus, and now this has come into French law:

http://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX:32014L0059

I a not sufficiently up in Finance to understand the consequences, but this article (in French) suggests that that indeed is the case.

http://www.medias-presse.info/lordonnance-est-passee-en-france-desormais-une-banque-pour-se-renflouer-pourra-ponctionner-les-comptes-de-ses-clients/42401

[lindal1000]

I think all banks can after the 60000€ protected limit. I got a letter from Barclays UK saying they can only protect funds up the £56000.

[idun]

 I thought that there was always a possibility in France that either the bank or government could 'take' what they considered 'unused' excessive funds.

Years ago on here, I am sure that I mentioned being told that a friend of a friend had had a lump of her biens taken from a deposit account. A wealthy woman and the money had just sat there for years and so, as my friend told me, it was retreived by the authorities. And my friend assured me that she had warned her that they would do that.

After that, I would forget to ask my friend about it.

So I am not surprised at this.

I suppose the trick is to keep money, if one has some (I do not), between several accounts in different banks, which are not linked in some way.

[Rabbie]

[quote user="lindal1000"]I think all banks can after the 60000€ protected limit. I got a letter from Barclays UK saying they can only protect funds up the £56000.[/quote]I got a similar letter from my bank (NatWest) and this was referring to the UK government guarantee if the bank went bust. Nothing to do with the bank being able to help themselves which of course they can by means of charges etc.

The only other way would be if the government decided to put a levy on all accounts over a certain amount as a result of a financial crisis. I can't see Cameron/Osbourne doing this in the UK as it would hurt them and their friends.

[NormanH]

I think this is something different. It is the idea that a bank that is going bust can just help itself to its clients funds, not a question of savings being protected.

In any case the French article implies that the guaranty isn't in place in Europe after German opposition:

Normalement seuls les comptes de plus de

100.000 euros peuvent servir au renflouement, mais cette garantie n’en

est pas une, tous les épargnants seront touchés. En effet à grand

renfort d’annonces les eurocrates avaient rassurés les épargnants en les

assurant que les  dépôts de moins de 100.000 euros seraient protégés

par la constitution d’un fond. La Commission européenne avait proposé la

création d’une « garantie européenne des dépôts », pour prévenir les

retraits massifs et les fuites de capitaux comme cela s’est d’ailleurs

passé en Grèce. Ce fonds de garantie devait être doté de 55 milliards

d’euros et d’une capacité à emprunter sur les marchés. Mais l’échec de

ce processus n’a pas bénéficié des mêmes effets d’annonces. Les

Allemands s’y sont opposés et la protection des 100.000 euros vient

officiellement de se volatiliser. Elle ne pesait pas bien lourd, mais à

présent elle ne pèse plus rien du tout, elle n’existe pas.  

[Patf]

I can quite believe it.

I know it's a different matter, but I've always been amazed that french utility companies etc can take money out of accounts for unpaid bills. Even if the customer hasn't set up a prelevement.

Another reason not to save?

But Idun's idea is a good one, if you do have spare money to put away, which we never have now.

[tinabee]

At the moment depositors are still protected up to €100,000

The process of the scheme is detailed here

http://www.garantiedesdepots.fr/sites/default/files/brrd_-_dgs_and_resolution_financing_0_0.pdf

However, in Austria bank deposits are no longer protected by the state - article here

http://www.thelocal.at/20150410/bank-deposits-no-longer-guaranteed-by-state

[NormanH]

Well you are always very well informed tinabee, but that link is dated March 2014 and the article suggests that it is no longer the case

" D’abord expérimentée à Chypre où les

comptes ont été largement siphonnés, la mesure est désormais applicable

en France depuis le 20 août. Elle est passée en douce par ordonnance"

[tinabee]

Sadly I can't find anything more recent, of an official nature, regarding French situation. But either way, I imagine that bank deposits are not secure if a bank goes bust

[lindal1000]

But isn't it the government that protects the first 100000 if the bank goes bust...but after that forget it! It always pays to have some FU money stashed in cash somewhere just in case everything goes very wrong!

[tinabee]

[quote user="lindal1000"]But isn't it the government that protects the first 100000 if the bank goes bust...but after that forget it! It always pays to have some FU money stashed in cash somewhere just in case everything goes very wrong![/quote]

The government only covers deposits in government regulated accounts, e.g. LEP, Livret A, etc.

Other accounts are covered by the FGDR which is a private organisation funded by the banks themselves - details here

https://www.garantiedesdepots.fr/en/fonds-de-garantie-des-depots-et-de-resolution/financing-and-management-fgdr

If the FGDR doesn't have enough money to cover the deposits of a failed bank, it can ask its members for further contributions or borrow money. Although where it would borrow from is not clear from their website.

[nomoss]

I understand that you don't legally own the money in your bank account anyway[:)]

Try searching "who owns the money in your bank account?"

[AnOther]

Money is a concept so nobody actually 'owns' any !

[nomoss]

[quote user="AnOther"]Money is a concept so nobody actually 'owns' any !

[/quote]

And everything works fine - as long as people are happy just looking at numbers on pieces of paper or computer screens [:D]

[tinabee]

Everything is fine until cash is banned and the banks impose negative interest rates, an idea floated by the chief economist of the Bank of England

https://petition.parliament.uk/petitions/109727

[Rabbie]

in real terms we have negative interest rates at present even with low inflation. Mind you people can lend me money at negative rates if they want.

[NickP]

[quote user="tinabee"]Everything is fine until cash is banned and the banks impose negative interest rates, an idea floated by the chief economist of the Bank of England

https://petition.parliament.uk/petitions/109727[/quote]

What a

load of tosh, how can any capitalist society exist without money? In

fact I'd like to know if any country in modern times has banned cash,

and if so how did anybody pay their way? I'm sorry, but if this was put

forward in the UK or any other western country. Yes and before you say

the obvious,  I know that someone has suggested it, there would be a

revolution. I concede that certain individuals could exist in a cash less way of life, but for the majority it just wouldn't work, after all who would decide who gets a Bentley and who gets a  Dacia. Anyway I'm certain that my money is safe under UK law, not

too sure about France?

[Chancer]

Banning cash does not mean a society without money, most money these days is just some électrons travelling down some copper wire and fibre optics.

 

With the exception of this years tourist rental which has meant me taking thousands in banknotes to the bank very regularly I exist pretty much without cash, I reckon that I spend no more than €20 a month in cash and I have not used coins for a couple of years, having all the cash hidden away has meant that I have paid for some things with it just to diminish the amount but without that I would be virtually cash free, I never carry more than €40 in my wallet and that never gets used, its there for emergencies.

[tinabee]

As Chancer says, cash is not the same as money.

Sweden is already heading towards a cashless society - lots of articles if you google it.

http://www.theguardian.com/world/2014/nov/11/welcome-sweden-electronic-money-not-so-funny

Cash payments in France are now limited to €1000

Banks can decide how much of your money you can have in cash in a branch, but HSBC will want proof of what you want to spend it on

http://www.bbc.com/news/business-25861717

[Rabbie]

Mrs Rabbie has just returned from a holiday in her native Sweden with a good assortment of goodies all paid for in cash so things have not gone so far there yet. But I agree that nowadays it is not difficult to use very little cash and pay for most things by credit/debit card. Indeed I very rarely now use cash on a regular basis for payments over £5.

[NormanH]

How do people manage that awkward gap between 0 and about 15@ below which many places refuse to take a card?

I am thinking about buying a coffee, a couple of stamps or a croissant all of which is quite likely later this morning..

[lindal1000]

Most places will take those contactless payment cards even for small purchases. In the UK your pin code is not needed for purchases under £30 with these.

The danger with outlawing cash is that the government is then free to devalue your savings by lowering the interest rate to below zero %, thus you end up having to give them money for having your savings, and if cash is banned then you can't just withdraw it.

Cash will always exist even if it isn't legal..and in those kind of scenarios it's real value will increase and the black economy will grow.

[NormanH]

"Most places will take those contactless payment cards even for small purchases."

I'm behind the times, but so I reckon are most of the people in the village.

Do French banks just issue them on demand to existing customers?

[Chancer]

I've got that covered Norman thanks to my not so new now regime.

 

I no longer eat bread so the boulangerie, croissants etc are no more, I dont drink alcohol so no stopping for a drink, places around here are never open when I would welcome a coffee, if I go to the supermarket and its less than €10 I kick myself as I have to get out a note and will recieve change, it rarely happens, a book of stamps lasts me years and can be paid for by card.

 

The €10 seuil de paiement for the cards is annoying and as last century as the weekly/monthly plafond, ie you are not allowed to spend your own money, neither exist in the UK and I havnt used cash there for years.

[mint]

You do have the option of using your cheque book?