© FOTOLIA archives Cash held by French households reached 225 billion euros in 2020.
The French keep more and more cash at home: this is the observation made by the Banque de France. What are the reasons that push individuals to withdraw part of their savings from banks?
Instead of depositing their savings in a savings book, a life insurance contract , a stock market investment, or simply into their current account, many French people choose to keep cash at home. Far from being incidental, this trend has been confirmed for several years.
More and more withdrawals, and less and less deposits: this is what the Banque de France is observing. A trend that has gained momentum since 2020, as recently indicated by Claude Piot, deputy director general of economic services and the Banque de France network, at Le Figaro : “The contrast is even more marked in 2020 with net issues in volume up by 8.8% while, according to our estimates, the inflow of banknotes at the terminals of the fiduciary sector in volume would have fallen by around 20% ”. An effect closely linked to the first containment and the coronavirus epidemic.
Who are these French people who “hide banknotes under their mattresses? “
But how does this translate in practice? In March 2012, the amount of cash held by households in France was 132.5 billion. In June 2020, this figure reached the record sum of 225 billion euros… or around 3,360 € per French! Don’t have that much cash at home? This is the case for the majority of households: 78% would hold less than € 1,000 if we refer to a study conducted at European level by the European Central Bank in 2016. A small number of households would thus concentrate a large part banknotes in circulation in the territory.
Although the bank card is already replacing a large part of check or cash transactions, cash payments still have a bright future ahead. Banknotes and coins are particularly useful for the purchase of second-hand items, to have a coffee in an ATM or when you forget your credit card (or code!). For many French people, especially seniors, cash is still the first means of payment used on a daily basis. Another motivation: the fear that the history of his card payments will be hacked, consulted or used by a third party. There is also concern among some people that their bank deposits will be taxed due to the crisis .
However, this operation alone does not explain the holding of large sums of money in some houses. In this case, it is a question of hoarding, that is, of keeping money aside without spending it. A way to save outside the banking system of which Erick Lacourrège, Director General of Economic Services at the Banque de France, spoke in 2019: “Depending on the type of population, keep change under your mattress or in the washing machine – as we usually say pictorially – this is not a vision of the mind, it is a reality of behavior ”.
A practice that is not without risk
But if the Banque de France, the tax administration and the government follow the circulation of cash closely, it is for other reasons. Indeed, the possession of large sums of cash can be indicative of tax or social fraud. At issue: moonlighting, drug trafficking, prostitution networks… So many illegal activities that need cash, and the anonymity it brings.
While the money kept in a current account or a passbook is guaranteed up to € 100,000 per person in each banking establishment, the money hidden under the mattress is not secure. Along with jewelry, they are also the most sought after goods by burglars. A situation from which sellers of safes benefit: the Hartmann brand experienced an increase of up to 40% on its sales made in France during the year 2020.
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