Banking system in France

Making the move from the UK to France is a big decision, and one of the biggest factors to consider is money - and the management of it. Those who plan to remain in France for only a few months could manage with their UK-based bank accounts for a limited period. However, prolonged stays will probably require a more permanent solution. Setting up a bank account is not too dissimilar to the process in the UK, but there are some key differences that a language barrier could make difficult to understand.

French Banks Explained

There are two main types of bank in France: mutuals and commercials. The main commercial banks are expected to make profits for shareholders, and they have at least one branch in all cities and most major towns. Mutual societies - sometimes referred to as cooperatives - are the equivalent of British Building Societies, and they are owned by members rather than shareholders. In much the same way as in the UK, people in France can bank with local post offices as well - known locally as La Poste.

Opening a French Bank Account

Whilst not recommended for British expats, it is possible to open a bank account by post. An application form, letter of recommendation, photocopy of a passport and a signature certificate must be provided, and this can take several weeks to complete. A far easier way to open a French bank account is to make an appointment at a branch. The process is similar to that adopted by British banks, but photo ID will be required (usually a passport) as well as a utility bill to prove residency. It may be a good idea for non-French speakers to arrange appointments with English-speaking bank representatives, but that could lead to a significant delay.

Bank Cards and Cheques

A French bank account will usually come with a French bank card - known locally as a carte bancaire or carte bleue. Most debit cards are operated by 'chip and pin' technology, and there is usually a small charge to pay on each transaction. However, a number of French banks give new customers free debit card use for the first year. It is worth noting that credit cards are not as widely used in France as they are in the UK.

Once an account has been opened, the account holder will be issued with a set of 'French RIBs'. Sometimes referred to as 'reebs', they are just small pieces of paper stating account information - used to open utility accounts and pay various bills and charges. Depending on the options chosen with the bank account, a cheque book will often also be issued within a week of opening an account, and although cheques are used more widely than they are in the UK, there are some key differences to be aware of when writing one out. The first line of a cheque will be marked 'payez contre ce cheque', and this is where the amount should be written in words. The name of the payee will always be written underneath the amount - the opposite of cheques in the UK. Account holders should be aware that the town in which the cheque is issued must be clearly stated, and everything must be in French!

The writing of cheques with insufficient funds to cover the transaction is illegal in France. Referred to as 'wooden cheques', they will often incur an immediate fine and a strongly-worded letter from the bank requesting that sufficient funds are made available for the transaction to complete. If this situation occurs twice within 12 months, the account may be forcibly closed. The account holder could be placed on a banking blacklist for up to 3 years, and it will not be possible to open another account for 12 months. Account holders should be aware that the process of clearing cheques in France is much quicker; it is not unusual for them to clear within one day.

Using Cash in France

Cash is withdrawn from ATM machines in exactly the same way as it is in the UK, and machines are located in all the usual places, including outside banks and in supermarkets. Many ATM machines will also accept cash deposits using an automated counting facility. Debit cards are used more widely in France than they are in the UK, so the vast majority of outlets have facilities for card payments.

The French banking system is essentially very similar to that of the UK. However, there are some subtle differences, and bounced cheques and unauthorised overdrafts are penalised much more severely. Banking in France requires a level of proficiency in French, but there are specialised services in English with some banks for people who are still learning the language.

Moving to France from the UK is a massive decision, and perhaps the most important aspect to consider is how finances will be managed. Banking in France is every bit as secure as it is in the UK, but dealing with complicated financial matters in a foreign language can leave people a little vulnerable. With some careful research and planning, there is no reason why the opening of a bank account in France should be a cause for concern.

Mortgages are subject to acceptation by BNP Paribas Personal Finance. For all mortgages the borrower has a 10 day reflection period. If the sale is subject to mortgage acceptance any sums already paid must be reimbursed by the seller if the mortgage is declined. Your home may be repossessed if you do not keep up repayments on a mortgage or any other debt secured on it. Changes in the exchange rate may increase the Sterling equivalent of your debt.