Barclays' new charges slammed by website

15/08/2008

Plans from Barclays to introduce a new overdraft charging have been criticised by financial website moneysupermarket.com.

According to the price comparison service, the Personal Reserve system is unclear - and charges are still too high.

Barclays launches the service, which works through charging a flat fee of £22 whenever an overdraft limit is breached by a customer, next Monday.

Under the terms of Personal Reserve, no further penalties are then taken by the bank for another five days after this levy.

Banks' allegedly excessive penalty fees have sparked controversy recently, and are the subject of an ongoing High Court case.

"The truth of the matter is that if overdraft charges were lower banks wouldn't need to resort to confusing 'reserves' and 'buffer zones' to try and make the charges more palatable," moneysupermarket.com's Kevin Mountford commented.

"I don't think [Barclays] are making the system any easier for consumers as the Personal Reserve…has had to set up a video blog just to help explain it."

He added: "Time will tell whether Barclays has created a useful current account innovation, or simply added further confusion to an already chaotic market."

Tags; Income Worries and Debt, Debt Management and Banking, Budgeting Advice,

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