Barclays overdrafts overhaul. Is it better or worse for you?

Former_MSE_Dan

What's happened?

On Monday 18 August, Barclays radically changed the overdraft facilities it offers. It now has 3 levels:

1. Normal Overdraft: Up to a limit e.g. £500 you’re simply charged interest at the agreed rate.
2. Personal Reserve. Go beyond that and within a set limit e.g. £250 more, you pay £22 to go into the personal reserve for five days and regardless of any other transactions there’s no additional interest or fees.
3. Above that. Go beyond that, and each transaction paid out costs £8.

Is it worth it - what's you're view

These new charges are cheaper than the old version for most people. However compared to the year's 0% overdraft and £100 you can get if you move to the Best Bank Account its still not that good.

Better still, do a budget and money makeover to get back into the black so any charges are irrelevant anyway.

If you bank with Barclays and have been given a personal reserve, please let us know what the effect will be on yor pocket by replying below

Thanks!

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BexTech

It will have no effect, never even needed to use the overdraft facility I have.

smithja

I think it is an interesting move and could save some people money.

I would like to see the claim substantiated that if you incur a bounce charge of £8 it has a negative effect on your credit record.

I suppose I have never looked into what the green dot means on a current account, i.e. you cant really be one month late with a payment unless you have entered in to some kind of plan to pay off an overdraft. So do they have other meanings? I also have never used my overdraft limit.

James

Dizzy_Izzy

I work for Barclays (Barclaycard precisely) and had no idea what to do once I received my letter explaining the new facilities and telling me how to opt out if I wished!!
As my personal account ( which my salary is paid into) is linked to our main account which is the Offset Mortgage package ( we got that when it was Woolwich and much preferred to deal with them!!) I was not expecting my account to be placed under the new rules, but hey ho!
As staff we have just had some info about new pension payments - my husband took mine to his work to get their account to give it the once over - it was written in such a way that I couldn't make head or tail of that either.

Mark7799

No change - I'll do what I've always preached. Get the maximum overdraft you can get formally agreed and make damn sure it's not exceeded. As an ex boss of mine used to say 'it's a limit, not a target'.

runciblespoon

What the letter doesn't make clear is that the 'Personal Reserve' costs £22 for each and every 5 days you go over. Imagine you go on holiday for 3 weeks and have a few Direct Debits come out in that time. You could be paying up to £110 for the Personal Reserve. Or you could pay £8 per bounced DD (and potentially a bounce fee at the other end).

If you check your account every day and have lots of payments out of your account then the Personal Reserve may make sense, but I can't see many cases where it would. If you're overdrawn for a month it'll cost £132 for the reserve. That's an awful lot of £8 DDs.

alfalan

As a soon to be ex-customer of Barclays this "improvement" to my account is nothing more than another money trap for the unwary, but a honey pot for Barclays. Go overdrawn or overdraw your overdraft limit by £1 and get charged £22, even if only for a day! What is the apr for that I wonder. My calculator doesn't have enough zeroes.

espressomanfishing

Blimey,

I got this leter & nearly had heart failure £1000 reserve? what ???. £22! per day!!! flippin robbers. the poster above makes a good point (i share his view) if you go on holiday and a few things hit your account you could end up payng hundreds in charges.... interest free... i think not.... Fortunately I have no overdraft loans or credit and my account has never gone overdrawn so I opted out right away. My advice is stay well clear of this one, its a slic way for the bank to trouser your cash when your not looking.....

By the way, three months ago started using the access numbers for cheap international calls listed on the site. my first bill was £40 .. yes thats right £40 lower than the previous quarter. Thanks Martin £160 saved... that a pint i owe you.:beer:

carisso

We have 3 accounts with Barclays, all have agreed overdrafts we use to the limit. One is for £5000, another for £4000 and the last for £1000. I am confused-what does the new system mean for us? Will I be paying a surcharge on every standing order, direct debit or for each cheque I write?

TotallyBroke

This is on my account although I do not intend to use it.

But I may have this all wrong but this is what I gather.
I spend more than my overdraft and then I need a direct debit to be paid.

The old way was Barclays refused it and charged you. The company it was being paid to didn't get paid and hit you with a late payment charge. ~or~ They paid it and charged you £35 for doing so. They could do this once a day upto 3 times a month. So charges could be £105 for the month.
This way, I see it that they will pay the direct debit and only charge you £22 for every 5 days you are in the reserve. Will work out at approx £132 for 6 lots of 5 in a month. So it is more expensive if you will constantly be over the overdraft limit.
But if your direct debits go out on Friday and your money doesn't go in until Monday it will only cost you £22. A bit better than the original £35.

I personally think it's swings and roundabouts. Very hard to compare but both equally as horrible.

Ben120379

Hi,

I hope somebody might be able to help, but I've got a Barclays account and I recieved a letter a few weeks ago about their new charges.

Last week I went overdrawn, past my agreed overdraft and was charged £30. The bank also wrote to me and advised me of this, however in this letter they did not make it clear that a further £22 would be charged to my account if money wasn't paid in within 5 days to clear this unagreed amount.

This means I am now charged £52 for going overdrawn once, insteed of the old £30.

I really need help as I'm getting charged every month and with my partner now off work on maternity leave things are getting impossible.

Advice of help please.

Thanks.