The ELP is a savings tool intended to finance a real estate project. (Photo credit: 123RF)
On the occasion of the publication of its 2020 annual report on regulated savings, the Banque de France returns to the problem of PELs opened before 2011, which serve on average guaranteed rates of 4.5% and weigh on good financing. of the French economy and on social equity.
The housing savings plan before and after 2011
The ELP is a savings tool intended to finance a real estate project. Its legal framework was amended in 2011 in order to strengthen its attractiveness for financing the acquisition of real estate. First of all, the remuneration of the new PELs is now revised annually. Then, their maximum lifespan is set at fifteen years and are automatically transformed into a classic savings account in the fifteenth year.
However, these changes do not apply to PELs opened before 2011. Thus, these PELs (on which it is no longer possible to pay after ten years of opening) continue to earn interest until final withdrawal. funds, while those subscribed after 2011 are automatically transformed into savings accounts after fifteen years of service.
While the remuneration of PELs opened after August 1, 2016 is 1.00%, the average remuneration of PELs opened before 2011 is, according to the Banque de France report, 4.46%! These PELs represent 38% of the outstandings and 55% in interest and premiums paid. In a context of persistently negative interest rates, they generate an abnormally high return in view of the absence of capital risk. By way of comparison, the rate of return on the French government loan stood at -0.5% on average over 2020 and the rate of return on the Livret A is 0.50%.
In addition, these PELs are transferable. In fact, a PEL of less than ten years and not expired on the death of the holder, can be taken back by the heir; on the other hand, any PEL of more than 10 years which expires on the death of the holder is closed.
The ELPs opened before 2011 weigh on the good financing of the French economy
In its 2020 report on regulated savings, the Banque de France is alarmed by this situation, believing that the PELs opened before 2021 weigh on the good financing of the French economy and on social equity.
The institution indicates that if the remuneration of the PELs opened before 2021 were aligned with that in force for the new PELs (i.e. 1%), the result would be a gain of around 3.9 billion euros in terms of resources for the financing of the French economy.