Banking incident fees down for vulnerable customers

The Banque de France reported on June 22 that bank incident charges for the most vulnerable customers had reached a 6-year low, averaging 118 euros a year in 2021.

Financially fragile customers more easily identified

In its latest annual report, the Observatoire de l'Inclusion Bancaire (French Banking Inclusion Observatory) welcomed the improved identification of customers considered financially fragile. A person is considered to be in a financially fragile situation if he or she has been registered with the Banque de France's Fichier central des chèques (FCC) for more than 3 consecutive months, following the withdrawal of his or her bank card by the bank or an unpaid cheque; or if he or she has been declared eligible for the over-indebtedness procedure.

Banks use other criteria to assess their customers' financial situation, such as account irregularities and payment incidents in recent months.

Thanks to actions (increasing the number of reception and advice structures, "budget advice points"...) implemented by social workers to raise awareness of the specific offer for financially fragile customers, banks have been able to increase the number of customers concerned by this scheme by 8% in 2021. In total, almost 700,000 people took advantage of the scheme last December, 15% more than in 2020 and twice as many as in 2017.


A decline in the number of overindebtedness cases

The Observatoire de l'Inclusion Bancaire has also noted a fall in the number of cases of overindebtedness. Between January and the end of April, some 39,000 cases were filed with the Banque de France, 6,000 fewer than the previous year. This represents an average drop of 13%, a figure that may seem surprising in the current context of high inflation.

However, Denis Beau, Senior Deputy Governor of the Banque de France, points out that this trend has been observed for several years, and is mainly due to the introduction of " social shock absorbers " during the Covid-19 crisis.

Among them are

  • the short-time working scheme, which enabled the hardest-hit households to maintain their incomes;
  • strengthening consumer awareness campaigns on hidden consumer credit;
  • the introduction of a law imposing greater prudence on banks granting credit to households in financial difficulty.

This fall in the number of overindebtedness cases does not mean that households are experiencing fewer difficulties. In fact, almost 190,000 customers had difficulty repaying their loans in the 1st quarter, even though they are not involved in overindebtedness proceedings or registered with the Banque de France.