Can you bank on it? Maybe not…

Let’s talk about banking & paying bills while living in a foreign country for a short period of time. When you move overseas this may be a challenge, as banks may not want to issue accounts to foreigners for short periods of time. So what are your options? How will you pay your monthly rent for your apartment? What about credit card bills? How will you have a supply of local currency? What about other bills and expenses? e.g. buying petrol/gas on French autoroutes can be tricky, as vendors often do not accept non-French credit cards. After doing some digging, I think I have some potential solutions to most of these problems –  at least for my situation – in going from the USA to France.

What have I learned about cross-continental and foreign banking so far? The bottom line: it’s complicated and depends partly on the country where you are currently living as a citizen/permanent resident. Since I currently live in the USA, I investigated my banking options there e.g. Can I open an account with a bank based in France while living in the USA? Yes I can, but with a couple of big qualifications. For example, HSBC [in 37 countries] has this plan: you can open an account in the USA – with various options, but if you do not want to pay for international wire transfers and have secure web banking, you must maintain a minimum balance of at least $10K in that account at all times. Then with the same bank you can open an account in France, in which you must maintain a minimum balance of at least 30K Euros. So you now have $10K and 30K Euros tied up in two bank accounts that are untouchable. This is not small potatoes and is out of reach for most people. Additionally, you must present yourself with your papers in a US city where the HSBC has a branch. [Understandable – otherwise people could easily engage in money laundering.] However, if you are in a university town far away from any city in which HSBC has a US branch [i.e. New England & Florida only] then you are looking at a jaunt to one of these East Coast cities before you leave. And the latter account can take about 3 weeks to set up.

The alternative is to wait until getting to France to open up a local bank account. This should, in theory, work. As I understand it, you need a fixed address during your stay, and must provide details of your passport, long-term stay visa and a utility bill/rental contract in your name for that address. They could also ask to see your employment details. The local bank account will give you access to a debit card, cheques, and paper slips called RIBS (Relevé d’Indentité Bancaire) that apparently are used to open utilities accounts in your name etc. Whether or not you will be permitted to open a bank account will depend, in part, on your country of permanent residence. For those coming from the USA this can be tricky: the US Federal Govt (via the IRS) places extra demands on all foreign banks to report information about accounts of all US citizens/permanent residents. Some foreign banks simply refuse to open accounts to those coming from the USA because they do not wish to deal with the extra reporting requirements.

So can you use your existing foreign bank accounts to pay bills? I still have accounts in my home country and performed my own electronic international bank transfer from my account for an apartment security deposit to my future Paris landlord’s account. [Note that this can take 3-4 business days.] Although I had paid the international transfer fee to my bank for the transaction, the sum of money arriving at the other end was 14.50 Euros less than arranged! Why the shortfall? Additional fees were charged – not by my bank – but by other bank(s) for the transaction. Either the destination bank or intermediary bank, or both, can charge additional fees – and you will not know about these until the transaction is completed. Even if I had put a trace on the transaction these additional fees would only have been seen after the fact. [Me thinks that this is a bit of skullduggery in this digital age…] So, how best to deal with this problem? Apparently the fees are likely to be constant – so if you were to engage in repeated transactions to the same foreign account you would just increase the balance that you are transferring to include the additional fees.

One unanswered question will be how I will deal with utilities bills if opening a local bank account is not possible. My guess: they should take credit card payments, however, there is a possibility that they might not take payment by foreign credit card.

What about using foreign ATM/credit cards etc. while you are living overseas? Thankfully, these days this is relatively easy – bank/credit card company apps on smartphones and computers have reasonable security and make electronic banking easy for the consumer. Foreign credit card bills can be easily paid from your foreign bank account(s) – if you do decide to use your ATM/credit cards from your home country. (However, you will be charged fees on foreign currency transactions, and these will add up over time). If you are using USA-based cards, beware that they are what I call faux chip & pin – they can sometimes cause problems when used overseas. Secure chip & pin cards are used today in most developed countries [with the exception of banks in the USA and Germany, as I understand it].

There can be some interesting idiosyncrasies for banking in France: if you are a married woman, you may be asked to provide proof that your husband has approved of you opening the account. For this and other idiosyncrasies see this excellent website about banking in France: https://www.expatica.com/fr/finance/Banking-in-France-Opening-a-bank-account-in-France_101158.html  See also: http://www.frenchpropertylinks.com/essential/banking.html This website is specifically targeted to people living in the UK, and who need to access banking services in France.

What is the take home message here? Do your homework. Do it early. It will take longer to sort things out than you might expect. If possible, test out funds transfers etc. ahead of time, or at least make sure that your electronic banking is set-up and is working without glitches at home before you leave. The solution to your particular problem and situation will likely be unique – your circumstances will probably be very different to mine, and to those of others embarking on a similar odyssey.

P.S. After uploading this post, friends & colleagues with links to France kindly advised me to check out: 1. on-line only French banking options: https://www.banques-en-ligne.fr/      2. borderless banking: https://transferwise.com/borderless?utm_expid=32817948-178.7YOAzw2WSiSrEMGAAxgUVQ.0&utm_referrer=https%3A%2F%2Fwww.google.fr%2F#borderless-account So it looks like there is quite a bit more homework to do!

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