Revolving credit
Understanding revolving credit before signing up
Revolving credit, once known as a revolving facility, puts a cash reserve at your disposal which you use freely, in full or in instalments. The portion used builds back up as you repay. It is the most flexible credit on the market, and usually the most expensive: at most institutions its rate is variable and sits well above that of a personal loan. With us it is fixed at 3.90%, like all our offers.
The Lagarde Act of 2010 placed strict limits on this product in France. Every instalment must now include a minimum amortisation of capital: it is no longer possible to repay only the interest, a mechanism that once made the debt virtually perpetual. The maximum repayment term is capped at 36 months for a reserve of up to €3,000 and at 60 months above that.
The lender must also inform you each year of the state of your reserve and offer you, from the first euro used above €1,000, an alternative in the form of a standard amortising credit. As lender and broker, our role is often to show you that this alternative is, in the vast majority of cases, markedly cheaper.
- Replenishable reserve: you pay interest only on the portion used
- Our offer: from €5,000, at an annual rate fixed at 3.90%
- Maximum term: 36 months up to €3,000, 60 months above that
- Minimum amortisation of capital compulsory on every instalment (Lagarde Act)
Key features
How the reserve works
A ceiling is granted to you, for example €10,000. You draw €3,000: only that portion bears interest. As you repay, the reserve builds back up and becomes available again.
A fixed rate, unlike the market
On most revolving credits on the market, the APR is variable and can change during the contract. Our annual rate is on the contrary fixed at 3.90%, subject to assessment and acceptance of the application.
Compulsory annual information
Each year, the lender sends you an updated statement of your reserve and asks you to confirm renewal of the contract. If it goes unused for two years, the contract is terminated automatically.
Associated store card
Many store cards carry a revolving credit. The law requires that cash payment be the default option: check the setting on your card, an unintended credit payment happens easily.
How it works
Identify the real need
A one-off need with a set date is better financed by an amortising credit. Revolving credit is only justified for repeated, short-lived cash-flow gaps.
Compare with an amortising loan
Cost both in our calculator. For the same amount and the same term, the difference in total cost in favour of the amortising loan is generally substantial.
Have your application assessed
Signing up involves an assessment of your creditworthiness and consultation of the FICP and FCC registers held by the Banque de France, exactly as for any consumer credit.
Manage your reserve
Once the contract is in place, repay above the minimum instalment as soon as you can: that is the only lever that genuinely reduces the cost of a revolving credit.
Our position on this product
- We tell you frankly when an amortising credit works out cheaper
- We cost the real total cost of the reserve, at the fixed annual rate of 3.90%
- We assess a consolidation of your revolving credits when they have built up: it is one of the most frequent reasons for consolidating
- We refuse to present a cash reserve as a solution to a lasting budget imbalance
Frequently asked questions
On the market, yes: the variable rate on cash reserves usually sits several points above that of a personal loan. With us, the annual rate is the same for every product: 3.90% fixed. For an identified need repayable over a set term, the amortising loan nonetheless remains the clearest choice.
The Lagarde Act requires full repayment within a maximum of 36 months for a reserve of up to €3,000, and 60 months above that. Every instalment must include a capital amortisation element: repaying interest only is prohibited.
Yes, at any time and free of charge, by simple letter. You remain bound to repay the capital already used according to the repayment schedule, but the reserve can no longer be drawn on and the contract ceases to be renewed.
Yes. Revolving credit is a consumer credit in its own right: the 14-day withdrawal period under Article L.312-19 of the French Code de la consommation applies in full to signing the contract.
Nothing formally prohibits it, but it is one of the most direct routes to over-indebtedness. Accumulating reserves sends the debt-to-income ratio soaring and complicates any later financing, including for property.
Often yes. Check whether your card offers payment “in cash” or “on credit”: since the Lagarde Act, cash must be the default option, but the setting is easily changed and rarely checked.
A cash reserve that is costing you dear?
Send us your current agreements: we will calculate what you would pay with an amortising credit or a consolidation. Free assessment without obligation.
Credit is a commitment and must be repaid. Check that you can afford the repayments before you commit.
