Barclays issues warning to customers with £0 to £10,000 in their bank account

Barclays branch
-Credit:Reach Publishing Services Limited


Barclays is set to reduce interest rates on two of its easy-access savings accounts. The Everyday Saver's interest rate will drop from 1.51% to 1.26% for balances up to £10,000, while the Rainy Day Saver will see a decrease from 5.12% to 4.87% for balances up to £5,000.

Confirming the shake up, Barclays said: "Interest rates are banded until February 12, 2025. This means that you'll earn the higher rate on the first £10,000 of your balance and the lower rate on the additional balance over £10,000.

"For example, if you had a balance of £10,100 interest would be calculated at the higher rate on the first £10,000 of your balance and the lower rate on the additional £100." With the Rainy Day Saver, you’ll earn the most interest with this account by using it to save up to £5,000.

ADVERTISEMENT

READ MORE: DWP urges state pensioners born before 1959 to come forward for quick and free £13,170

READ MORE: DWP sending letters to 60,000 people from Saturday 'demanding action'

READ MORE UK warned February 'snow events' looking more likely and could be days away

If you want to save more than £5,000, you could put £5,000 in this account and any additional money in a different account that will pay a higher interest rate. If you’re saving for the long term, you could explore your investment options with us. Investments may offer higher returns than cash savings in the long term.

Barclays says: "For savings accounts, the interest rate tells you how much interest we’ll pay you for saving with us – it’s shown as a percentage of your account balance. The higher the interest rate the more interest you’ll earn by leaving money in the account."

ADVERTISEMENT

Your Personal Savings Allowance (PSA) is the total amount of interest HMRC lets you earn each tax year across all your bank accounts (except ISAs) without paying tax. The tax year runs from 6 April to 5 April. Your PSA depends on how much income tax you pay each year – it’s £1,000 tax-free interest for basic rate taxpayers and £500 tax-free interest for higher rate taxpayers. Additional rate taxpayers don’t have a PSA.

If you earn more in interest than your PSA, you’ll need to make sure you pay the tax that’s due to HMRC. Go to HMRC’s site to find out how to do this.