‘Round up’ banking enables people in France to save without realising
The method is seen as a way for shoppers who might normally struggle to save to build up extra cash
The system enables people to save by rounding up transactions, so they build up savings without actively realising it
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Did you know that some banks and apps in France can help you save money by ‘rounding up’ when you make a payment, in a bid to help you save funds without realising you are doing it?
The ‘l'arrondi épargne’ system enables shoppers to round up their purchases to the nearest euro, and deposit the excess in another account. For example, for a baguette that costs €1.10, a total of €2 would be taken from the payee’s current account, with the extra €0.90 added to the savings account.
This can be a traditional savings account such as the Livret A, or the Livret de développement durable et solidaire (LDDS), or in a virtual savings account (which may or may not offer interest on savings).
Read also: Livret A savings: Why are they so popular? How do I open an account?
Some can even save the extra money in a cryptocurrency portfolio (for example, a Bitcoin account).
Banks to offer the service include:
Smartphone apps, which connect to your bank even if it does not offer its own rounding service, include:
App options to maximise savings
Each user saves around €100 a year, according to conservative estimates. Some may save much more, depending on the app, and whether you use the rounding up service alongside automatic saving options.
For example, Plum offers several levels of saving ‘rules’ for regular direct debits, ranging from ‘Shy (50% fewer deposits)’ all the way up to ‘Beast mode (75% more deposits)’. It also has the option to save €1 even for transactions that are ‘exact’ and would not generate a ‘round up’, e.g. for a transaction of €3, it would save €1 (as opposed to a transaction of €2.90, when it would only save the extra €0.10).
Because the saving is done without the user actively realising that they are saving, the method is touted as a way for people who would otherwise struggle to save to amass some extra cash.
Read also: What are the tax-free bank accounts in France?
Some apps offer other options, such as Moka, which lets you round up to the nearest euro and activate a multiplier (up to eight times), to help you save even more.
Most systems will have a safeguard in place to ensure that the saving plan does not cause you to go into overdraft or face other consequences such as missing payments or direct debits. As always, it is a good idea to check the terms and conditions of any money or saving apps.
