How easy is it to change bank in France?

Changing banks in France has been described as an ‘anxiety-inducing’ process despite a law being brought in to make it easier. As bank fees are set to rise again, we look at how switching works.

Switching banks can quickly become complicated, as you must inform every company with your details - especially those taking regular debits, for example, for utility bills - of the change.

In a bid to make this easier, the loi Macron on ‘mobilité bancaire’, which came into effect in 2017, states that once a client opens an account, then the new bank - rather than the individual - must put their automatic payments in place.

However, only 20.3% of people who switch invoke the loi Macron, and instead transfer their details piecemeal themselves, according to a 2021 report from the regulation authority l’Autorité de contrôle prudentiel et de régulation (ACPR).

Grégory Guermonprez, the director of online bank Fortuneo, told Le Monde that changing banks can still be an “anxiety-inducing process”, but that “in the end, the process is simpler than one might imagine at the start”.

How do you change banks in France?

Normally, the client first signs a permission form with the new bank, which includes the details of their previous account. The two banks then switch everything from the old bank to the new bank in the next 28 days.

The new bank must contact the old one within 10 days of this signature, and the old bank must provide - within five working days - the details of any direct debits or regular payments from the past 13 months.

This generally includes details of the employer, their energy, telephone and internet bills, their healthcare insurance and mutuelle, and social security payments.

These companies must be informed of the change within three working days, and then must confirm their receipt of the change and make the switch.

However, one user in Paris told Le Monde that when they tried it, the system “did not work for some major companies”, including the tax office, Canal+, and Free.

“It’s very surprising that these public or almost-public services aren’t perfect on this subject,” he said.

This means that it is still a good idea to double check how the switchover is going yourself, to be sure that everything has moved as planned.

Can you transfer savings accounts to a new bank?

There is no official process for transferring these over. If you wish to move them, you will have to make the necessary switches yourself.

This includes the regulated savings accounts of Livret A and Livret de développement durable et solidaire (LDDS). You will need to open these again with your new bank, as you can only ever have one at a time.

Similarly, you cannot transfer a compte à terme(a specific savings account) to another bank.

In some cases it is possible to transfer a mortgage. However, this is by no means a given, and usually depends on the initial terms and conditions.

However, it is possible to transfer a Plan épargne logement (PEL) and a Plan épargne en actions (PEA), although the process can take several months.

How to save money on banking fees

French banks charge surprisingly high fees both for holding an account and for card processing, particularly when compared to UK banks.

The regional nature of many French banks meant that their fee structure and interest rates vary within the same establishment.

This means that it pays to look closely at the often opaque payment structures of your account.

Estimates from consultancy firm Bain suggest that 4.1% of people in France change their main bank (i.e. their current account) every year.

However, people aged 25 to 34 are most likely to switch, at 8%, largely because they are “more used to comparing prices and services”, the consultancy said.

In addition, fees are set to rise by an average of 2.5-3% in 2024 compared to a relatively stable 2023, according to a new study by consumer association CLCV (published on January 9).

Read more: Banks in France criticised over new fee rises

The study found that ‘small customers’ with basic services - such as a simple account and one debit card - and ‘medium customers’ - who have two or more cards with loss and theft insurance - are suffering the highest rise in rates, of 2.97% and 3% respectively.

Since January 1 this year, annual bank charges have risen to €66.23 for the first group, and €147.80 for the second, CLCV said.

Online banks and neobanks offer significantly lower rates for both bank charges and card processing fees. In many cases, they offer these services for free. This comes at the loss of face-to-face contact with a financial counsellor, since most online banks do not include this service at all.

Read also: Is the money in neobanks protected the same as French bank accounts?

The government has provided a free tool to compare bank accounts and check their different services and fees. This is available at www.tarifs-bancaires.gouv.fr.

It lets users compare basic services such as transfers, direct debits and bank card prices, as well as other more niche services.

Have you changed your main current account in France? How easy or difficult was it? Let us know at news@connexionfrance.com.

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