LEP vs Livret A : le taux d’intérêt fait la grande différence

The interest rate: the big difference between LEP and Livret A

The only common point between LEP, Livret A, and LDDS is that they are tax-exempt. The interest is not subject to income tax. For the rest, LEP stands out strongly from the other savings products.

Firstly, it is only accessible to low-income households, subject to income conditions. To open an LEP, a single person must not earn more than 21,393 euros per year, and 32,818 euros for a couple.

The ceilings also differ : for LEP it is set at 7,700 euros, compared to more than 20,000 euros for a Livret A. But what is important for households is of course the interest rate. And there, the LEP has no equal: the law requires this savings product to fully compensate for inflation. In February 2023, its rate therefore rose to 6.1%, while the Livret A reached 3%.

Towards a drop in the popular savings account rate?

Widely touted as an anti-inflation product, the Popular Savings Account was a great success in 2023. At the end of March 2023, according to the Bank of France, more than 9.6 million LEPs were open in France. More than a million more than at the end of 2022 (8.5 million). The attractiveness of the interest rate and inflation hitting household portfolios pushed the French to protect themselves.

And protector, the LEP will always be. Except that inflation is starting to slow down. In May 2023, according to provisional data from INSEE, it fell to 5.1% over one year. It is very high, but much less than at the end of 2022 when it exceeded 7%. Consequence: the interest rate should fall.

We will have to wait for the final inflation data for June 2023, published by INSEE in mid-July 2023, to know the future interest rates of tax-exempt savings accounts. But unless there is a rebound in price increases before the summer, the LEP rate will fall on August 1, 2023. And potentially fall to 5.8% or even 5.7%. What will still remain a hyper-attractive and unique rate in the French banking landscape.