Can finance meet the expectations of the French?

Finance has changed profoundly since its creation and especially in recent years: development of environmental or social criteria, arrival of blockchain, etc. At the same time, behaviors have changed with the rise of ETFs, the rejuvenation of investors and the reduction in the holding period of securities. In the current political context, radically opposed visions clash. Is finance really viable in France?

Politicians are (again) attacking finance!

French society is currently experiencing deep divisions, particularly between supporters of a more or less liberal economy and those who defend a more united and equitable model. Social movements, demonstrations against pension reform, and debates on tax justice illustrate these tensions well.

In the more liberal perspective, some politicians advocate a market economy with little state intervention. “Liberal” politicians propose deregulation measures and tax cuts to stimulate economic growth. Therefore, apart from a few politicians, liberals are not represented in France. It is more a question of “less intervention”.

Politicians: what positions on finance?

Conversely, interventionists advocate a distribution of wealth and increased regulation of financial markets to avoid “excesses” and “protect” citizens. For example, the New Popular Front proposes a “reinforced” tax on financial transactions. LikewiseEmmanuel Macron proposes an extension of the tax on financial transactions from France to Europe. We will recall that this tax only applies to investments in shares destined for France. Surprisingly, even a large part of the politicians at LR are favorable to a broadening of the tax base on financial transactions to interday transactions. This example reflects quite well the direction of the debate on finance in France.

A strengthening of this tax would certainly reduce the average holding period, the contribution of capital in France, and the flexibility of many investors. The vision of finance is therefore rather naturally defiant in France, especially when it comes to new assets. Thus, the New Popular Front sees cryptocurrencies as “speculation tools that must be strictly regulated.”

The debate around “solidarity finance”

Solidarity finance is a form of financing that aims to support projects with a “social or environmental utility”. The expansion of these considerations, particularly through ESG, has given rise to a multitude of funds and criteria. But this concept takes on particular importance in the current context in France, marked by growing political and social tensions.

In finance, sustainable funds generally show lower returns than other funds but benefit from a better image. While it is clear that the development of “solidarity finance” influences the organization and strategy of companies, political support is not as clear. In addition, it remains difficult for many medium-sized companies to cope with the demands of increasingly standardized finance.

Key figures

In 2022, the outstanding amount of solidarity savings reached 24.5 billion euros. This marks an increase of 20% compared to the previous year. This amount, although still marginal compared to the overall outstanding amount of savings in France, demonstrates a growing interest among savers for responsible and ethical investments.

Solidarity savings products, such as the Sustainable and Solidarity Development Booklet (LDDS) and sharing funds, have raised around €600 million in funding. In addition, the government has strengthened advantageous tax measures, such as the income tax reduction for subscription to the capital of solidarity enterprises (SOFICA) and the advantages linked to the SME-ETI Share Savings Plan (PEA).

Limitations and Challenges

Despite these advances, solidarity finance in France faces several obstacles. First of all, awareness of these products remains limited. A study by Finansol shows that only 20% of French people are aware of the existence of solidarity finance. This lack of visibility hinders the broader commitment of savers.

In addition, the profitability of solidarity finance products is often lower than that of traditional financial products, which can dissuade some investors. The projects financed, although meaningful, are often perceived as riskier. This limits the appeal for large institutional investors. Finally, regulatory frameworks and transparency requirements sometimes represent an obstacle for small structures.

Is the road to centralization of finance inevitable?

For more than a century, we have observed a trend towards the centralization of the banking system in the United States and Europe. Since 1990 in Francethe number of banks fell from more than 1,800 to 769 in 2021 (-58%!). This phenomenon is mainly linked to regulatory and normative inflation, but it is also linked to the presence of extraordinarily low rates after 2010. The concentration of the financial system around large national or global players favors: a rise in power of a few standardized products, higher rates, increased systemic risks, and a risk of political collusion.

The extreme centralization of finance, however, seems to have been disrupted by certain innovations. In particular, the arrival of blockchain seems to shake up the way finance is practiced.

A community and decentralized vision: the contribution of cryptocurrencies

Bitcoin and other cryptocurrencies offer an alternative to traditional financial systems. Indeed, their decentralized nature allows for increased transparency and reduced dependence on centralized financial institutions. This gap in terms of regulation and practice between the old world and the new calls into question the sustainability of traditional finance. Indeed, more and more managers, banks or funds are promoting the development of blockchain as a support for long-term financial assets.

In general, blockchain enables finance to evolve in the following areas:

  • Transparency and traceability. Blockchain allows tracking every euro invested in a project. This ensures that the funds are used in accordance with the stated objectives. In addition, it strengthens the trust of donors and investors.
  • Reducing transaction costsBy eliminating middlemen, blockchain typically reduces transaction fees. This allows more funds to be channeled directly to projects.
  • The rapidity. Blockchain transactions are executed in real time. This accelerates project financing and the implementation of initiatives.
  • DemocratizationBlockchain facilitates access to financial services for unbanked populations, by offering decentralized microcredit and payment solutions.

However, some point out the high energy consumption of Bitcoin. Despite this, there are many blockchains that are economical and meet the needs of tomorrow's finance.


Solidarity finance in France represents an innovative and necessary response to sustainable challenges. In France, the regulation and supervision of finance seem particularly successful. The tax on financial transactions reflects this fairly widespread conception of finance. At the same time, the increase in standards and regulations has led to the development of solidarity finance. Public authorities have put in place incentive measures and advantageous tax systems.

However, this new approach to finance has some limitations. Although it is growing, the diffusion of solidarity finance is still moderate. The associated returns are often lower, and the requirement of procedures for companies is greater. Finance is also faced with a growing problem of centralization. In Europe as in the United States, the concentration of the banking sector results in less competition which can affect the consumer.

In this context, finance must regain a certain flexibility in the face of tomorrow's challenges. Blockchain, in particular, plays a crucial role in the modernization of solidarity finance. It offers total transparency of transactions, a significant reduction in transaction fees, and increased efficiency. This technology is revolutionizing the way solidarity funds are managed and distributed. It also makes it possible to include unbanked populations in the financial system, thanks to decentralized microcredit and payment solutions. However, blockchain still has some limitations to be widely applied and used by traditional finance.

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