31 October 2017

Adventures in Banking

Adventures in Banking
(By Rick)

This is a quick summary, without the actual twists and turns, of our experience getting bank accounts in France as Americans. Being Americans makes this harder because of additional reporting requirements imposed by the US government, even if you are a double national as I am. Most banks don't think it's worth the extra work to cater to American customers, but we found that Crédit Agricole would take us on. I'll just summarize that process by saying this: if you're establishing your account from abroad or don't speak any French yet, then CA's Key Finance division may be worth a look. If neither of these constraints applies, you'd probably find it much easier walking into your local branch with your documents in hand. Your documents will include things like proof of ID (passport), birth and marriage documents, tax ID number, proof of French address (in the region connected with the branch), proof of income, and 3 most recent months of bank statements. There is the Catch-22 situation here in France that renting or buying a place to live requires a local bank account, and getting a bank account requires a local address. We got around this by arranging a one-month rental in advance over AirBnB. We got our very helpful landlord to attest that we lived there, and that worked for our proof of address. Once we had our account, we rented a long-term place. After moving in, I walked into our local branch (with ID) and moved the account to that branch. One bank agent even spoke a bit of English to smooth over gaps in my banking vocabulary. As part of the change, we also had to submit proof of our new address to the bank and to the US and French tax authorities.

The first type of account you get is a compte courant, or "current account". We'd call this a checking account in the US, but agents at my bank actually discouraged the use of checks, because they're considered old-fashioned. Still, best to ask for them, since most medical professionals don't accept cards and do expect payment on site (French national health insurance sends reimbursements to your account by transfer). They're also free. There is a fee for a debit card (ours is 39€/year), and there's an account maintenance fee (ours is 2,10€/month). The latter includes insurance against fraudulent use of your card. You can get a simple ATM card for less, but unless your US card has chip-and-PIN capability, you'll want a debit or credit card that has that feature. A number of automated payment sites won't accept US-style chip-and-signature cards or card swiping (for example: buying train tickets, paying for postage, and most embarrassingly, paying tolls on the autoroutes). Our debit card came enabled for "contact-free" (RFID) transactions, which are for those who think putting a card into a machine and tapping in a code is too much work. Call me a luddite, but RFID looks like a way to get your information hacked more easily, so I asked them to disable it; no problem.

Checking accounts in France don't pay any interest. We are not in a hurry to transfer our savings from the States, but when we had enough here for about a year or so, my bank offered to explain savings account options. There are two types of savings accounts: taxable and tax-free. The difference in interest rates between them is about the same as the tax you would pay to France on the taxable account, and the tax-free accounts would still be taxed by the US, so ordinarily, I would have gone with a taxable account. BUT! Here again, there was a catch: taxable accounts require a tax ID number, and we don't have one yet. Taxes in France are paid on the previous year, and, well, the previous year we didn't live in France or have any French income, just like every year before that. So no tax ID. Ok, ok, I'll take the tax-free Livret A. The Livret A pays 0,75% interest per year at present, to go up to 0,85% next year. That's not quite as good as our Credit Union in the US, but the money will be handy and already in Euros. The Livret A is limited to 22.000€ per person (no joint accounts), but we're not likely to touch that limit any time soon. Under French law, if your spouse dies, you inherit his/her Livret A automatically and tax-free, but there is a month's delay. We decided to split our "savings money" into two Livret A's: one for each, just in case. There was another tax-free savings option that paid 1%, but if you took the money out before 2 years, it would be retroactively reduced to 0,5%, so not worth it for us.

8 comments:

Dennelle Taylor Nizoux said...

Good summary, Rick. Just a clarification on this part "There is the Catch-22 situation here in France that renting or buying a place to live requires a local bank account, and getting a bank account requires a local address. We got around this by arranging a one-month rental in advance over AirBnB. We got our very helpful landlord to attest that we lived there, and that worked for our proof of address."
I believe we got Key Finance to create your account without a French address. The difficulty arose when we asked them to put in place a 'cautionnement bancaire' for your long-term rental, as those can only be set up by a branch.

Julie said...

Hi Dennelle, they could start the process without a French address, but it was required to complete it, and most importantly, to unblock the account so we could use it.
The Caution was a messy side note :-\

Julie said...

BTW, here's a post that has banking problems sprinkled throughout.
http://slowtravelin.blogspot.fr/2017/03/housing-hazards.html

Paula Hunter said...

I’ve just moved to Uzes and need to start the banking process soon. Did you ever consider the Post Office bank? I’ve heard they are easier.

Julie said...

Hi Paula, we looked at La Poste bank first in fact - you get a bit through the process before you find out they won't have Americans as account holders! (One of the many banks that don't want to deal with the added paperwork required) :-\
(And, welcome to France!)

Paula Hunter said...

Hi Julie, Thanks for the fast response...and you just saved me some time. Please excuse if multiple comments come through...I’m never sure if the entry has been accepted! . I love being here!

Julie said...

No problem, Paula - I have the same issues with some blogsites (including this one!)

Julie said...

I do apologise for how long it took to post about this (I finally gave up, and got Rick to do it lol).
I think our experience was so far off the norm that I didn't want to scare off people; at the same time, we have to be prepared for things to not go according to plan :-\