Borrowing from a private individual without a bank is legal in France if the loan stays occasional, rests on a signed document, is declared to the tax office above 5 000 € and never involves upfront fees paid to a stranger.
What "without a bank" means in legal terms
Under French law, a cash loan between private individuals is a consumer loan governed by articles 1892 and following of the Code civil. No credit institution takes part: the lender commits their own savings and the borrower repays them on terms agreed together.
The banking monopoly: where a private lender must stop
Article L511-5 of the Code monétaire et financier reserves regular lending to institutions licensed by the ACPR, the French banking supervisor. An individual may help out someone close, but anyone publishing loan offers in series runs an illegal activity, very often a fraudulent one.
PSFP platforms: mostly business financing
Since European regulation 2020/1503, crowdlending platforms must be approved by the AMF as crowdfunding service providers. They finance companies and professional projects, not consumers, as our comparison of peer-to-peer lending sites points out.
Family or friendly loans: by far the most common case
Most loans made without a bank are arranged between parents, children, siblings or close friends. Trust does not excuse you from paperwork: the tax office can treat an unrepaid sum as a gift when there is no IOU and no regular transfers.
Written proof required above 1 500 €
Article 1359 of the Code civil requires a written document to prove any transaction worth more than 1 500 €. The IOU states the sum in figures and in words, written by the borrower personally, although a detailed loan agreement is still the better option.
Freely set interest, in writing and capped by usury rules
Under article 1907 of the Code civil, an agreed interest rate must be set down in writing, otherwise no interest can be claimed. It must also stay below the usury rate published every quarter by the Banque de France, or the lender faces penalties.
Formulaire 2062 and tax on interest
Any private loan above 5 000 € must be declared on formulaire 2062, the French tax form for loans, which the borrower attaches to their annual income tax return. Interest received by the lender is taxable, as our page on taxation of private loans explains.
Optional registration to obtain a certified date
The agreement can be registered with the tax office for a fixed fee of 125 €, which gives it a certified date that is binding on third parties. This precaution proves useful in an inheritance, a divorce or a dispute with the lender's heirs.
A notarial deed for large amounts
To fund a property deposit or a large sum, a notarial deed is directly enforceable: if payments stop, the lender instructs a commissaire de justice, a French bailiff, without a prior court ruling. The notary also checks both parties' identity, which rules out fake lenders.
"Loan without a bank" ads on social media
Facebook groups, TikTok accounts and WhatsApp messages promising a fast loan without a bank almost always hide a scam: instant approval, followed by demands for processing or insurance fees. Read our report on loan scams spread through social media.
Checking an intermediary in the ORIAS and AMF registers
A credit broker must appear in the ORIAS register, and a crowdlending platform on the AMF list of approved providers. The blacklists published by the AMF and the warnings issued by the ACPR also flag websites that impersonate official institutions or banks.
Unpaid loan or fraud: available remedies
With a defaulting borrower, a formal notice sent by registered letter comes before an injonction de payer, a payment order from the tribunal judiciaire. A scam victim files a complaint with the police or gendarmerie and reports the fraudulent site to PHAROS or Info Escroqueries.
Setting up a private loan without a bank, step by step
- Make sure the lender is someone you genuinely know, never a profile reached through an advert or a messaging app.
- Agree on the amount, the term, any interest rate and the monthly repayment schedule before any money changes hands.
- Draw up a loan agreement or a signed IOU showing the sum in figures and in words.
- Have the funds sent by named bank transfer, never in cash, prepaid vouchers or cryptocurrency.
- Above 5 000 €, attach formulaire 2062 to your annual income tax return.
- Repay each instalment by labelled transfer and keep your statements until the loan is fully settled.
Costs of borrowing outside a credit institution
| Item | Indicative amount | Comment |
|---|---|---|
| Interest between individuals | Free, from 0 % up to the usury rate | Rate in writing, otherwise no interest due |
| Registration with the tax office | 125 € fixed fee (indicative) | Optional, gives a certified date |
| Notarial deed | Fees vary with the amount | Useful for large sums |
| Form 2062 declaration | Free | Mandatory above 5 000 € |
| Upfront fees demanded by a stranger | Total loss of the money paid | Sign of a scam, never pay |
Documents to gather before signing the loan
- Valid identity document for both parties
- Recent proof of address
- Signed loan agreement or IOU
- Bank details (RIB) of lender and borrower
- Dated repayment schedule
- Formulaire 2062 if the loan exceeds 5 000 €
- Proof of the initial transfer of funds
Traps of lending outside the banking system
- Accepting a lender met on Facebook or Leboncoin who promises funds with no bank and no checks, then asks for fees before the transfer.
- Paying processing fees: article L519-6 of the Code monétaire et financier forbids collecting any sum before the loaned funds are actually paid out.
- Handing over cash or receiving a loan with nothing in writing: in a dispute or after a death, the debt becomes almost impossible to prove.
- Sending a passport copy and bank details to a stranger, enough material to open accounts or take out credit in your name.
- Skipping formulaire 2062 on a large family loan, which exposes you to the loan being reclassified as a gift during a tax audit.
Your questions about borrowing without a bank
Is a private individual allowed to lend me money without a bank?
Yes, the Code civil provides for loans between individuals as long as they remain occasional. Someone offering credit on a regular basis would breach the banking monopoly. To secure the deal, put it in writing and have the key clauses checked by a notary or a lawyer.
Are there French platforms that lend to private borrowers?
Crowdfunding platforms approved by the AMF under the European regulation mainly finance businesses and professional projects. A website promising an individual a personal loan without a bank, with no visible approval or ORIAS number, should be treated as suspicious until proven otherwise.
Can the lender ask me for collateral?
Yes, the agreement can include a third-party guarantee, a pledge or, before a notary, a mortgage. However, a guarantee paid in cash to a stranger before you receive the funds matches the classic pattern of an advance-fee scam.
What happens if the lender dies before the loan is repaid?
The debt becomes part of their estate: the borrower still owes the heirs according to the agreed schedule. A written agreement, registered or notarised, plus traceable transfers, prevents disputes over the outstanding balance and over whether the money was a loan or a gift.