Three things to know about the Livret A

Posted on Dec. 2021 at 19:01Updated 13 Dec. 2021 at 19:08

Difficult for the government to cut it. The Minister of the Economy and Finance, Bruno Le Maire, announced on Monday that the government would increase the pay rate of the Livret A from 1er next February, without specifying the extent.

A decision taken in response to the persistence of inflation which eats away at the real performance of savers when they have massively increased their savings accounts since the start of the crisis. Here are three things to know about the Livret A, which is often called the preferred placement of the French.

A nest egg of 343.5 billion euros

According to the latest figures from the Caisse des Dépôts, the total outstanding amount of the Livret A reached 343.5 billion euros at the end of October. A record. And for good reason, since the beginning of the health crisis, this investment has been one of the main receptacles of the forced savings of the French, just behind sight deposits, that is to say current accounts.

In 2020, collection thus stood at 26.39 billion euros, the largest amount since 2009. This represents an increase of 134% compared to the collection of 2019 (11 billion). 2021 will not be so flamboyant but is however already on the list of the most collecting years: from January to October, 16.96 billion euros.

To a lesser extent, the Livret de développement durable et solidaire (LDDS), which enjoys the same rate of return as the Livret A, also received part of the Covid savings: the outstanding amount is 125.4 billion d euros and collection since the start of the year stands at 3.68 billion, after a record 8.82 billion in 2020.

The preferred placement of the French

If the Livret A is often given this nickname, it is because almost the entire population has one. According to the Regulated Savings Observatory, there are thus 55.7 million Livrets A, of which 54.9 million are held by individuals. That is to say a holding rate of 80.1%. This rate is stable compared to 2019. In other words, the crisis did not trigger the massive opening of accounts.

On average, the French hold 5,500 euros on their Livret A. In reality, a large part of the outstanding amount is monopolized by the wealthy fringe of holders: 17% of Livrets A, those on which more than 15,300 euros are saved, represent 64 % of outstanding.

By comparison, there are 24.3 million LDDS (a holding rate of 46%) which weigh on average 5,000 euros. 31% of LDDS represent 73% of outstandings.

Where the Livret A money goes

The Livret A is a savings product specific to France, which allows the government to finance some of its public policies. “Historically, the Livret A finances social housing – and recently, in addition, urban renewal,” can be read on the website of the Ministry of Finance.

Concretely, the Caisse des Dépôt, which is responsible for centralizing around 60% of the regulated savings collected by the banks (i.e. nearly 300 billion euros), lends money to donors for the construction of social housing, as well as that, in particular, to local communities to help them carry out their projects.

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