Month after month, deposits by individuals in their current account are falling, but the overall amount is still very high: more than 500 billion euros. On average, each household still has a little less than 1,700 euros in their current account. A colossal sum!
The French draw more and more on their current accounts. In the first trimester, they drew 18.2 billion euros from their current accounts and in their reserves they keep at home in the form of cash, what is called numraire, according to the latest quarterly statement from the Banque de France.
Also according to figures published on Thursday by the Banque de France, individuals still keep nearly 509 billion euros in their current accounts. This is 35 billion euros less than last July’s record.
This then represented an average of 18,430 euros on current accounts nearly 30 million French households, compared to less than 7,000 euros fifteen years ago. Now, households have on average just under 17,000 euros in their checking account. An average which of course hides enormous disparities, and which gets along well per household, a couple for example being able to have several current accounts (individual, joint, child account, etc.).
Oversaving Phenomenon
These very high amounts are linked to the oversavings accumulated during the health crisis. French households have been maintaining a major savings effort for more than 3 years. In 2022, they set aside, according to the Banque de France, 158.7 billion euros, i.e. a level equivalent to that of 2021 (161.1 billion euros), underlines the economist Philippe Crevel. This flow is lower than that of 2020, a year marked by confinements (202.1 billion euros). It nevertheless remains significantly higher than its level before the health crisis (101 billion euros over the 2015/2019 period).
Precautionary savings: these French people who hide their banknotes under the mattress
But now, outflows on current accounts are growing. Several explanations for this. A certain part of the households touch their savings to offset the rising cost of living.
Continuation of the arbitrage movement from current accounts to savings accounts
But beyond that, it is also an arbitrage strategy on the part of individuals who move part of the cash accumulated in their non-remunerated current account to the regulated savings accounts such as Livret A or LEP, the rate of which is 3% and 6.1% respectively since February 1. As a result, these risk-free products see the amount collected soar. The Banque de France rightly underlines this favorable arbitration for the Livret A, LDDS or LEP in its quarterly study on household savings: it points to a continuation of the movement of arbitration of deposits seen [les comptes courants, NDLR] (-18.2 billion) to remunerated deposits [les livrets] (+33.6 billion).
Livret A and LDD collection (in billions of euros)
Source of data: monthly press releases from the Caisse des Dépts on the flows and outstandings of Livret A and LDD savings accounts.
The Livret A, the favorite investment of the French, recorded a historic month of March. Deposits exceeded withdrawals by 4.17 billion euros. A surprisingly high score for this time of year. As of March 31, the cumulative outstandings of the Livret A and its cousin the Livret de développement durable et solidaire (LDDS) reached a record level of 535.1 billion euros.
Precautionary savings: how much, on which account or passbook?