Seven bank account rule changes coming in July - new card fees and free cash

James Rodger
·4-min read

A full list of bank account changes coming in weeks – including new card fees and free cash offers - has been revealed. Some of the biggest banks in the country are set to make major changes to account rules and interest rates as we move forward towards the end of June and beginning of July.

The high street banks continues to offer free cash payments to customers in a bid to entice them to switch as the Cost of Living crisis continues. But some banks and financial providers have hit their customers with brutal changes to the account terms and conditions, it has emerged.

Barclays is among them, hiking credit card repayments. It will also change the APR that it charges some customers and some account holders on "historic rates" will see an increase of up to 9.9 percentage points. Barclays customers should read communications carefully to see how their rates might change.

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You should get at least two months’ notice for increases.

Barclays

Barclays is changing the way that it calculates the monthly minimum repayments for credit card customers in July. Barclaycard – thought to be the UK’s biggest credit card provider – has written to customers telling them it is cutting their minimum payments to give them “more flexibility”.

A Barclays spokesperson said: “We have made these changes to increase flexibility for our customers, and have been clear in our communications that paying more than the minimum can help customers clear their balance sooner and pay less interest.”

Lloyds Banking Group - Lloyds, Halifax, Bank of Scotland

Lloyds Bank, Halifax and Bank of Scotland customers have been warned ahead of a major change. Lloyds Banking Group, which owns all three brands, is shaking up the interest rates charged on its overdrafts and some customers could potentially have to pay more.

An overdraft lets you spend money or withdraw cash if your balance drops below £0 - but you can be charged interest on anything you spend over this limit. Currently, there are two standard rates you are charged for falling into your overdraft at the three brands - these are 39.9% and 49.9%.

A cheaper overdraft fee of 27.5% is offered to people who pay £3 a month for a Club Lloyds Bank account. From August the banking group will add two more tiers at 19.9% and 29.9% and depending on your credit history and how you use your account you will be moved onto a specific tier. However, the standard rate will be 39.9%.

Lloyds Banking Group

Lloyds has announced that Silver and Platinum account customers will soon be able to use their debit cards anywhere in the world free of charge. The move comes after the bank’s debit card data showed increasing demand for card spending overseas.

In the first three months of 2024, Lloyds said debit card spending on foreign currencies reached 45.7 percent of the total seen in 2023, with spending outside the UK hitting 44.2 percent of the 2023 total.

Metro Bank

Metro Bank will cut the rate on its variable Current Limited Edition savings accounts to 3.95% AER on 8 July. The Current Limited Edition rates refer to Metro Bank savings accounts that are closed to new customers, but the rate is still live for those who took advantage of the account before it came off the market and met the eligibility criteria at the time.

Customers affected include those who opened a Current Limited Edition Instant Access Account or Instant Cash ISA between 10 November 2023 and 12 February 2024, and are currently earning one of the following rates: 5.22% AER, 4.97% AER, 4.51% AER or 4.01% AER.

Nationwide

Nationwide has announced its Member Exclusive Bond, which offers a rate of 5.5% AER for 18 months and will be available to all 16 million existing members. The rate is 1.25% higher than Nationwide’s existing 1-year Fixed Rate Bond.

For the maximum investment of £10,000, that means £125 extra interest over a year and £193 over 18 months. The bond can be opened in a branch, via the banking app or through internet banking.

Shawbrook Bank

Shawbrook Bank has increased the interest rate on its three-year fixed rate cash ISAs to 4.4% AER. It’s also increased rates on its one-year fixed ISA to 4.8% and on its five-year fix to 4.11%.

First Direct

First Direct is axing its text message banking service in a few months' time. Account holders will no longer be able to receive text notifications about their current account balance and they will also stop receiving "mini-statements" via SMS, which include your balance and the five most recent transactions.

The service will cease for good on Saturday, August 10.

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