Despite inflation, the French remain less over-indebted than in 2019

The surge in prices is starting to weigh on the budgets of some households. The number of over-indebted people increased by 6% during the first nine months of the year compared to 2022, notes the Banque de France. In total, 89,234 files were submitted to the institution, compared to 89,478 a year earlier. Having a few unpaid credits is not enough to plunge you into over-indebtedness; the incidents must be repeated and repayment of the loan proves difficult.

“The 6% increase is a point of attention for the Banque de France,” notes Mark Beguery, director of personal services at the Banque de France. But payment incident reports by banks have remained low and stable since the spring.” On the ground, associations helping people are seeing “very difficult situations, but there is no tidal wave,” adds Mark Beguery.

Above all, despite galloping inflation, the number of over-indebted people remains 21% lower than in 2019. A year which, however, was not “very accident-prone.” The reasons are multiple, but the main one is surely linked to the job market which is holding up quite well. “The drop in unemployment is one of the keys to the halving of the number of over-indebtedness cases since 2015,” notes Mark Beguery. Another explanation is that salaries and in particular the minimum wage have increased over the past year, which helps to partly offset the increase in prices. Social assistance and consumer credit regulations also play a role.

In this context, the Banque de France does not expect the situation to deteriorate in the coming months. “In the coming two to three months, we believe that the number of overindebtedness files will remain stable,” explains Mark Beguery. The economy is expected to slow down, but this should not have an impact on unemployment and inflation should fall.