Banque de France: bad payers caught because of late payments

modified: 2023-01-24 21:03:02

After a year of raising awareness in 2022, this year the Banque de France has decided to apply the penalties linked to late payment.

  Banque de France: bad payers caught because of late payments

Each country has a central bank . This last one is an institution that controls the flow of money in a country . Unlike the commercial bank, a central bank does not have an individual as a client, but commercial banks. This feature earned it the name of “bank of banks” . The Banque de France is a national central bank integrated into the Eurosystem. If private individuals cannot create accounts there, businesses can . As a bank, this institution applies rules for its customers. This year, a new rule applies for late payment of credits .

What is the Banque de France?

The Bank of France is a public monetary institution . As its name suggests, it is the central bank of France. She is the pillar of the Eurosystem in France . The latter is a federal system which brings together the European Central Bank and the national central banks of the euro area. According to the official website of the Banque de France, it has 3 main missions:

“Its three main missions are monetary strategy, financial stability and economic service to the community”.

We are talking here about the monetary strategy at the scale of a country. Thus, the Banque de France experts develop the economy of France . Financial stability is about the flows of money circulating throughout the country. Since it serves as a bank for commercial banks, it is she who ultimately decides the amount of money that circulates .

The last mission is of particular interest to us in this article, because it is in the economic department that the Banque de France can offer business loans . Speaking of credit, the Banque de France has decided to sanction late payment.

Banque de France: what sanction in the event of late payment of credit?

Don't worry, we're not talking about criminal sanctions here. It is a matter of economy so the sanctions affect the economy too. Since last year, excessive late payment leads to outright degradation of the credit note. What does that mean ?

In simpler terms, if a company is slow to pay the credits it has taken. The amount of credit he can apply for decreases. It is a sanction, because the credit value assigned by the Banque de France serves as capital for run the business . This penalty began to apply since 2022.

Late payments: 2022, 'a year of raising awareness'

Relayed by the Capital information site, published on January 23, 2023, the Banque de France justifies that the year 2022 is:

'A year of raising awareness for businesses'

This is so, because during this year, the targets “were subsidiaries of intermediate companies (ETI) or large companies in excellent financial health” , i.e. 1,680 entities. At the end of the campaign, the rating of 10% of these companies is downgraded because of late payment deemed excessive. This corresponds to approximately 150 companies.

It was also a year of raising awareness, because the rules were not very strict . In fact, large companies who have moderated their delay even though they are still late , were spared. More :

'As long as the company is able to justify why it has high deadlines, we don't degrade it'. explains Emilie Quema, director of companies at the Banque de France to AFP (Agence France-Presse).

Late payments: 2023, one year of application

If 2022 was 'a year of raising awareness', you could say that 2023 is the year of application . On January 11, 2023, the Governor of the Banque de France, François Villeroy de Galhau declared that the number of companies examined would be tripled in 2023. This announcement, he did it before the Senate Finance Committee . He also stated that:

“The extension of payment terms to SMEs and VSEs by certain larger companies is obviously not acceptable. »

The governor added that:

“According to our estimates, 16 billion euros of cash would be unduly captured by these large companies. »

There you go, the Bank of France will be tough this year against late payment . You have been warned.

Source : Capital