Coronavirus: Barclays waiving overdraft fees until end of April

Oscar Williams-GrutSenior City Correspondent, Yahoo Finance UK
Yahoo Finance UK
An exterior view of a Barclays Bank branch in central London. (Dinendra Haria/SOPA Images/LightRocket via Getty Images)
An exterior view of a Barclays Bank branch in central London. (Dinendra Haria/SOPA Images/LightRocket via Getty Images)

Barclays (BARC.L) is waiving overdraft fees for customers for a month in response to the ongoing novel coronavirus pandemic.

The bank said on Wednesday it would waive all interest on arranged overdrafts from 27 March to the end of April. The changes will take place automatically, meaning customers will not need to contact the bank to take advantage.

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“It’s crucial we offer the right support to our customers through this challenging time,” Gillean Dooney, managing director at Barclays, said in a statement.

“We have therefore decided to waive all overdraft interest until the end of April, meaning there will be no charges for customers to use their arranged overdraft. We are reviewing all options to help customers after this time to ensure we support those in financial difficulty.”

Read more: UK chancellor missed out one major way to help millions of Brits

Barclays is the first major UK bank to announce a pause on overdraft fees. The Covid-19 pandemic has coincided with planned changes to overdraft charges, which come into force in April. Many banks had announced plans to raise annual interest charges to at or around 40%, leading to criticism around the timing.

Shadow chancellor John McDonnell this week told The Independent: “Banks must put this on hold. This is a real kick in the teeth at this time when people are being laid off and struggling to get by.”

Alongside the overdraft pause, Barclays on Tuesday also launched a new online form aimed at speeding up the process of applying for a mortgage payment holiday during the coronavirus crisis. Mortgage customers can defer payments for up to 90 days.

Read more: Fears on overdraft fees as HSBC hikes rate to 40%

Barclays has already announced it would stop late payments and cash advance fees on its holidays, as well as removing penalty charges for early access to fixed term savings accounts.

Business customers can also apply for loans of up to £5m ($6m) through the government-backed Coronavirus Business Interruption Loan (CBIL) scheme launched this week.

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