Barclays has alerted customers to be on the lookout for a letter regarding account changes after a disgruntled customer reached out over social media. The customer expressed their frustration, stating: “Despite never exceeding our overdraft limit, never being persistently overdrawn, today you significantly reduce our overdraft limit.”
They highlighted the timing as particularly harsh, adding: “In what is possibly the most stressful financial month. Oh and sending a text out after your lines have closed? Cynical move.” In response, Barclays explained that it conducts yearly reviews of overdraft limits to ensure they remain suitable and informed the customer that a letter should be forthcoming.
The bank clarified: “You should also receive a letter to advise of the outcome of the review, but we do sometimes send a text message to let customers know in advance.” Barclays also mentioned that customers can usually view letters in the app or online banking within two working days of the letter being sent out.
The bank apologised for any upset caused and provided a link to mental health support information page. Barclays currently charges 35 percent interest on overdrafts, applicable to any amount used within the agreed limit.
For instance, the interest cost of borrowing £500 would be £2.88 over seven days, £12.45 for 30 days and £25.21 for 60 days. These charges apply daily when you’re overdrawn and will be billed to your account monthly.
Some overdrafts are set up with an interest-free amount, meaning interest is only charged on amounts exceeding this limit. If your arranged overdraft includes an interest-free amount, interest is calculated on the overdraft amount used above your interest-free limit.
If you don’t have an arranged overdraft but spend more than what’s in your current account, there’s no interest to pay. Customers should be aware that having an overdraft could impact your credit score.