The Dutch-born online bank ING has confirmed that it will soon exit the French market, leaving its customers in suspense. Here are some ideas to understand what will happen.
ING today announces that it is withdrawing from the online banking market in France. It was in a short press release dated December 21, 2021 that the online bank ING, formerly ING Direct, formalized his departure. The end of a lease of more than 20 years, since the brand of Dutch origin took its first steps in France in 2000, with the launch of its famous Livret Epargne Orange (LEO).
Since that date, ING has enriched its catalog, which today includes bank accounts, life insurance, the stock market and credits. It has also won over many customers: about a million, she claims. A figure which, however, has not changed since 2015. This is what explains its withdrawal: The decision (…) is linked to the economic context, in particular the environment of low interest rates, a limited market share and negative financial results for online banking in France, explains the bank on his Web Caf, a forum dedicated to its customers.
When will ING complete its withdrawal? What will become of its little million customers? Update on what we know today.
What is the schedule for the withdrawal?
Questioned by MoneyVox, ING did not not able to specify the schedule. Anyway, his effective departure from the French market is not for tomorrow.
Online banking has, in fact, confirmed looking for third parties likely to buy back its portfolio of clients. A process that is still ongoing (read below). Whether this research is successful or not, it will then be necessary long months, undoubtedly more than a year, to concretize this exit. The first time to get the various green lights from the regulators. Then give customers time to think about it and, if they wish, to transfer their accounts to another bank. Finally, in the event of a takeover, to effect the effective transfer of the accounts of the remaining customers.
Will there be a buyer?
This is ING’s will. We are in fact in discussions with third parties. On the other hand, we cannot communicate any name, confirmed the communication from ING to France MoneyVox. Discussions are ongoing and, as you know, this is a process that can be tricky. If we come to an agreement, we will announce it appropriately.
Over the past few months, all of the historic online banks, those that emerged in the 2000s or early 2010s, seem to have considered at one point or another to apply to strengthen their own customer bases.
These discussions, which began at least since last summer, have not yet concluded. At the end of November, a source announced daily The echoes that it was a matter of a few days. But more than a month later, still nothing. According to information from The gallery, published on January 4, only two candidates remain in the running: the Socit Gnrale group, owner of Boursorama, and Crdit Mutuel Arka, which owns Fortuneo. According to the same source, Crdit Mutuel Alliance Fdrale, the main shareholder of Monabanq, has thrown in the towel, as has Crdit Agricole, owner of BforBank.
However, there is nothing to say that the buyer, if there is a day, agrees to take over the entire ING portfolio. Always according to The echoes, Boursorama Banque, which is now a favorite, does not wish, for example, to recover its outstanding real estate loans.
Should ING customers be worried?
Seeing your bank, the one you use every day and where you put your money, leaving the country is never reassuring. ING’s announcement left many customers with suspicion, who blame the brand for not having informed them directly, but only through the press.
However, there is no need to be worried, in any case on the future of the assets. Leaving ING is a strategic choice, not bankruptcy. It remains backed by its powerful Dutch parent company, which boasts 39million customers in 40 countries. Customers benefit from this title from European guarantee mechanism on their deposits (current accounts, LEO, cash accounts of securities accounts and PEA) up to 100,000 euros per depositor. The assets on Livrets A and LDDS are 100% guaranteed by the French State. Finally, the money invested in life insurance is not held by ING, but by the insurer Generali, and remains covered by the Guarantee Fund for Personal Insurance (FGAP) up to 70,000 euros per person.
ING will, moreover, maintain a presence in France, since it does not give up its activity of corporate and investment banking aimed at large companies (Wholesale Banking).
As for products and services, nothing changes immediately. Customers continue to benefit from the usual online banking services, confirmed ING. Customers and partners will be informed individually before any change concerning products and services.
How will the withdrawal go concretely?
Asked about the concrete modalities of its withdrawal for the bank accounts, life insurance and credits of its customers, ING did not wish, at this stage, to provide details.
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Either way, the transition will result in friction for customers. If there is a buyer, we can obviously imagine that the latter will benefit from support towards equivalent products offered by the new bank. However, even in this case, not everything can be automated.
The case of current accounts is hardly problematic. Of course, the change of bank will entail the addition of a new IBAN, and therefore the need to change the domiciliation of recurring transactions. There is, however, a device, the mobility mandate, which makes it possible to largely automate the process. There will also be edition of a new bank card, and consequently needs to change its details if they are registered with certain suppliers: electronic commerce sites, streaming services, electronic wallets, etc.
The transition will be easier for the money placed on a LEO: a simple transfer will allow the transfer to an equivalent passbook offered by the new bank. On the other hand, it will be a little more complicated for regulated savings books. There is no possibility of transferring a Livret A or an LDDS from one bank to another and the simultaneous possession of several of these products is prohibited by the regulations. The transfer cannot therefore be automatic and the money will have to pass through another account while waiting for the opening of the new payment booklet, with a risk of loss of fortnights of interest.
Livret A: how to transfer it to another bank?
The transfers of securities accounts and PEA between banks are possible and could thus be implemented within the framework of the transition. They are usually chargeable, but one can imagine that ING will offer a fee deductible in this specific case.
There remain two more difficult cases: those of life insurance and credits. As it concerns life insurance, ING operates as a distributor. The insurer is called Generali and it is with him that the transition will be managed. There are several possible scenarios. If the transferee also works with Generali (which is the case, for example, with Boursorama), the transfer itself should not pose any problems. This scenario has in particular t facilitated by law Covenant, which authorizes transfers between contracts marketed by the same insurance company without loss of tax precedence for the insured. The transfer should also be possible to a new insurer, without loss of tax precedence, in the absence of a buyer or if the latter does not work with Generali. There is a precedent: that of ACMN Vie which, with the agreement of the ACPR, regulator of the sector, was able to transfer its portfolio of life insurance contracts online Suravenir.
Finally, credits. In the thread of his Web Caf, ING has promised that the outstanding loans will continue on the same terms and conditions, regardless of the acquiring organization. In the event that this buyer refuses to collect the loan portfolio, the existing contracts should be transferred to the parent company, which will ensure their management until the extinction of the last debts.
Is it possible to leave immediately?
It is a possibility. The agreement signed with a bank is a indefinite contract which can be terminated unilaterally and without notice if it is the user’s initiative. Some clients, speaking on our forum, have already started to transfer their accounts and contracts, including their life insurance, to brokers also working with Generali.
However, such a choice constrains make these changes independently and, where applicable, pay fees: transfer fees for securities accounts and PEA, early repayment indemnity (IRA) for credits. At the moment, ING does not, at first glance, intend to give it away.
In the absence of risk to their assets, clients have therefore rather interest procrastinate and wait to know a little more than the concrete terms of ING’s withdrawal before taking the steps.
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