Europe is facing the highest inflation in the last 40 years. The results of the barometer of the CETELEM Observatory 2024, carried out in 10 European countries, speaks for itself: a large majority of consumers, some 87%, say they are worried about inflation and their purchasing power. France is not immune to this context of tight budgets and the Banking Inclusion Observatory considers that the so-called “financially fragile” population represented 4 million customers at the end of 2023.
What is a financially fragile customer?
In France, several criteria are used to assess the financial fragility of a customer, who may be deemed fragile if they have 5 payment irregularities or incidents during the same month, if they feature for 3 consecutive months in the Central Cheque Register or if they have an over-indebtedness file being processed with the Banque de France. The law on the regulation and separation of banking activities of July 2013 requires banks to put in place a system to detect their customers in a situation of financial fragility.
At BNP Paribas, the criteria for identifying financial vulnerability are: over-indebtedness, bank ban, record of a card withdrawal or credit repayment incident. This also includes our more occasional fragile customers i.e. victims of an accident of life, who are identified as soon as they have more than €25 in incident charges for 2 months in a row and their monthly credit flows come in at below €1,609 for a single person.
Regulatory systems in France
- The right to a bank account: This “right to account” procedure, established by the banking law of 1984, is one of the pillars of the French banking inclusion policy. It includes the option of referring the matter to the Banque de France, which will designate a bank required to open a deposit account with basic banking services free of charge. Since 2022, the procedure for accessing a bank account has been simplified to guarantee access to everyone.
- The fragile customer offer: All banks must propose the OCF (specific fragile customer offer) to their customers identified as financially fragile, who are free to subscribe to it or otherwise, for a maximum sum of €3 per month. This specific offer includes basic banking services and the capping of intervention commissions at €4 per transaction and €20 per month. According to figures published by the Banking Inclusion Observatory, at the beginning of April 2024, nearly 1 million French people benefited from the OCF. Only private individuals qualify.
Since 2019, payment incident charges have been automatically capped at €25 per month or €20 per month with an annual cap of €200 per year, for BNP Paribas customers holding the Account Package offer. This free offer dedicated to vulnerable customers includes a payment card with systematic authorization, two bank cheques per month, a subscription to remote banking services, or the sending of alerts on the account situation by text message. Thereby, 40% of customers who have subscribed to the specific offer do not pay any fees during the year. For others, the amount of fees is capped at €20 each month.
Centres for financially vulnerable customers
Our financially vulnerable customers are guided towards Centres Specialized in Budget Solutions (CSSB). This fully online service, unique in the French banking landscape, provides tailor-made support via 130 advisors, spread across 8 sites in mainland France.They start off by carrying out a detailed budgetary assessment of recurring income and expenses, the biggest items most often being insurance and energy expenses, to propose a long-term regularization solution. Their main mission is lending support through credit, as part of a responsible approach to granting this facility. Thanks to the expertise and assistance of these dedicated advisors, nearly 3 out of 4 customers are back in credit at their original branch, 8 weeks at the latest after their arrival at the CSSB.
Since 2018, Centres Specialized in Budget Solutions have been certified INRC Human for Client. This certification, assessed by AFNOR Certification, recognises Responsible Customer Relations delivered face-to-face or online.
AXELLE: a platform to help our customers along the path to recovery!
We are aware that some customers, without being debtors per se, just about scrape a living, and that they too need support: the Axelle platform, designed by BNP Paribas, can offer a response. As part of its commitment to the fight against financial insecurity, within the "Collectif d'Entreprises" for a more inclusive economy, BNP Paribas has chosen to support the most vulnerable through financial inclusion solutions. The Axelle platform launched in September 2020, is a concrete expression of this desire. Free and accessible to all, it aims to support and accelerate the recovery of financially fragile individuals. A catalogue of inclusive offers that includes advice, assistance, practical information and useful tips to make their daily lives easier and help them control their budget around 9 themes: Budget, Employment, Housing, Leisure, Mobility, Digital Technology, Nutrition, Healthcare, Support.
"As a responsible Bank, BNP Paribas is keen to put in place services and solutions that promote the inclusion of all. We designed the Axelle platform to provide a practical response to the needs of our most vulnerable customers when it comes to information and advice. Because the financial and social inclusion of the most vulnerable is our duty as bankers, it is essential that we act as Axelle's ambassadors."
NiCKEL, the inclusive neo-bank of BNP Paribas
BNP Paribas has rounded off its banking offering with Nickel, the inclusive neo-bank. Acquired by the Group in 2017, NiCKEL has remained faithful to its original value proposition: to be accessible to as many people as possible, with no income requirements, with the possibility of opening a current account in 5 minutes in a network of partner points of sale and thus having access to the most modern means of payment.NiCKEL is currently the leading current account distribution network in France, but in recent years 5 other European countries have been able to benefit from its services: Spain from 2021, Belgium and Portugal from 2022 and Germany from 2023. Initiated since 2020, the collaboration with the Banque Commerciale in France, that became more widespread in 2023, make it possible to provide a response tailored to the needs of our customers and prospects and to direct the different types of customers towards the offer that best suits them.
In 2023, the first NiCKEL impact report (produced with Archipel&Co) demonstrated the positive contribution of its model and its impact in economic, societal or regional dimensions.
BNP Paribas Personal Finance: a responsible credit player
Helping to build a more inclusive society and allowing the most disadvantaged to access consumption are part of the DNA of Cetelem, the consumer credit brand of our subsidiary Personal Finance. A signatory of the Charter for Banking Inclusionand the prevention of over-indebtedness, BNP Paribas Personal Finance is committed to developing mechanisms for early detection and handling of its customers' difficulties to anticipate their over-indebtedness as much as possible. This commitment also includes a training component for its employees in contact with customers on these topics. Finally, BNP Paribas Personal Finance delivers annual reporting for the Banking Inclusion Observatory, detailing its practices in this area.
- Personal microcredit: To facilitate access to credit, since 2008, Cetelem has proposed a personal microcredit offer, in partnership with the Caisse des Dépôts, the Secours Catholique, the Restaurants du Cœur, CRESUS and the Crédit municipal de Paris. This consists of a small loan granted to people excluded from the banking system, to enable them to start or keep working by purchasing a good or service that is useful for their personal project.
- ABC programme "Customer Budget Support"*: As of 2012, Cetelem implemented Budget Support, intended for customers in situations of potential budgetary fragility. This is a proactive system in the sense that early detection makes it possible to anticipate customer needs and help them rebalance their budget. Support and advice are the watchwords of this programme, which is based on three key issues:
- Anticipate and identify our customers' budgetary weaknesses;
- Assess the difficulty of the situation and provide guidance;
- Implement the most suitable solutions and advice.
The ABC programme can call on a team of specialized advisors dedicated to this support process to find solutions adapted to each person's profiles and difficulties. The objective is to prevent customers from ending up in a non-payment situation. Vulnerable customers are identified using a predictive score, and we intervene to provide a lasting solution after accurately diagnosing their budgetary situation.
*“Customer Budget Support” is the result of a tripartite collaboration between BNP Paribas Personal Finance and partners such as Crédit Municipal de Paris and the association Cresus.
The “inflationary crisis” initiative in France:
Implemented in early 2024, this Personal Finance' initiative falls within the inflationary economic context that we are currently experiencing. The challenge is to act preventively with customers who show a high probability of having difficulty repaying their credit. A team of 25 employees were mobilized to deal with all customers. In concrete terms, customers presenting predictive signals are targeted via a CLICK TO CALL text message so they can be called back immediately or fix an appointment to carry out a budget assessment to define the kind of difficulty they are facing: is it organizational or cyclical? In the light of this diagnosis, restructuring solutions or referral to the ABC unit mentioned above are proposed.
At the end of May 2024, of all the budget assessments carried out, 60% of customers presented proven difficulties.
BNP Paribas CARDIF : insuring our most vulnerable customers
Positive impact is at the heart of the value proposition and strategy of our insurance subsidiary BNP Paribas Cardif. In February 2022, the creation of an Impact and Innovation department supports this ambition to make insurance products and services more accessible.
The social action fund (FAS):
Existing since September 2023, this fund provides exceptional financial support. It is reserved for insured customers who have subscribed to a borrower insurance contract or an insurance policy (death, incapacity, invalidity) and who find themselves in a vulnerable situation due to a serious health problem or an accident. The Social Action Fund can take two forms:- payment of capital in the event of a loss or serious event not covered by the insurance contract,
- coverage of various costs linked to the situation of the insured: travel and accommodation costs to go to a dedicated medical centre, costs related to the purchase of a medical device, psychological aid, help returning to work or, in the case of a child affected by a rare illness, coverage of part of the expenses linked to a school assistant, etc
- Partnership between BNP Paribas Cardif and the Neon neo-bank, in Brazil
With more than 10 million customers, the Neon online bank, founded in 2016, is one of the largest fintechs in Brazil. Its goal is to promote access to simple and fair financial services for its customers and, in particular, become the bank for Brazilian workers. On the insurance side, a survey carried out among its customers found that 80% do not have insurance, primarily due to its high cost. In addition, most of those who have purchased an insurance product in the past say they did not renew it due to financial difficulties (37%). For BNP Paribas Cardif, which has a similar goal of making insurance more accessible, this partnership provides for an exclusive five-year contract, which must result in a comprehensive protection programme for various insurance products (property, life and finance).
The current context reinforces our firmly held belief that personalized support makes it possible to sustainably rebalance our customers' budgets and develop our relationship of trust. The fight against exclusion is one of the values defended by BNP Paribas, through its daily activities and its commitments aimed at contributing to a more sustainable and inclusive economy.
