Cheque clearance in France

[DonD]

Hi, How long does a cheque (check) take to clear in the French banking system. What I need to know is if, for instance, I wrote a cheque today (Friday) for groceries, when would I have to ensure funds in my CA account to cover it? Monday the bank is closed - is that general for France or just regional? Does it count as a bank processing day? Funds will be in the account Tuesday, Wednesday latest. What are the implications? I hear that they are severe in France. Thanks in advance for helpful responses.

[frogblogger]

Not every bank is closed Monday, just some of the small provincial branches... I'm pretty sure that funds clear/are debited on a Monday too.

Sorry, have never checked on clearance times. I'm with the CA too, I just assume if I pay a cheque in it will take at least a couple of days to clear, the time the CA takes to ok it with the issuing bank. However if I write a CA cheque at the supermarket I reckon the funds would have to be there within 48 hours to cover it.

Most banks will give you a small overdraft facility from day 1 of say 300 euros...

Yes banks are pretty inflexible in France. Possibly why they haven't had to be bailed out for billions unlike in the US/UK! Then again, there was the Credit Lyonnais fiasco of a few years ago...

[Bevdeforges]

Be very, very careful with floating checks in France. Overdrafting is a felony (though usually the real crime is the charge the bank hits you with!) and if you overdraft I think it's 3 times, the bank can simply throw you out as a customer.

The other trick is that many banks (check with yours for details) accept a check on the day it's presented and then process it with a transaction date the day before - so if the check is presented for payment at the bank on the 15th of the month, the funds are withdrawn from your account as of the 14th.

Then, for deposits, the opposite is true. Bank records your deposit as arriving on the 15th, and credits your account as of the 16th. So you're two days overdrawn if you like to cut things close.

The date on the check actually counts for nothing - unless it's old enough that the bank can simply refuse to accept the check.
Cheers,
Bev

[Matou]

If you overdraft your bank will impose you a "fine" and send you (at your cost) a registered mail of information including a command not to draft any other cheque before the situation is corrected. Drafting a cheque after such a command is a "délit" (Art. L163-2 Code monétaire et financier) with a possible sanction up to 5 years of prison and a € 375000 fine. To clear the situation the "offender" should either pay the amount of the cheque to the recipent in exchange of the cheque which will be returned to his/her bank or pay a provision to his bank (secured on a separate account) to cover the amount of the cheque. Another sanction for overdrafting can also be the interdiction to draft cheques for 5 years.
Legally, a cheque is not valid anymore 1 year and 11 days after the date of emission so if you forget to deposit a cheque for too long it will be lost...

[DonD]

Thanks to all for the hints and tips. I have now found a very useful site that appears to have up-to-date and valid information. Especially regarding Banks and Tax.

Information on France Guide to Living Working Moving to France

[GALLUS]

Thank you Bevdeforges;

From what I have experienced with most banks

1- it take 2 working days for a cheque to be cleared by banks

2- most cheques (especially in country side) are not remitted to the bank same day by the creditor (expect additional days for clearance)

3- foreign cheques need 21 calendar days to 28 days to clear

Some banks charge for each cheque issued by account holder, some others charge a flat yearly fee and finally some others charge a fee for cheque book issuance (25 or 50 pieces)

In France, it is customary to negotiate delays of presentation of cheque for clearance with your supplier (the ones you know well). For instance you can negotiate for end of week remittance, or end of month. Each cheque has a validity of 90 days. In some banks 30 days.

It might be possible also to pay terms with cheques for large amounts (issuing 3 cheques in lieu of 3 installments)

good luck