Barclaycard: Britons impacted by major change to credit card terms from today

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Barclaycard is used by hundreds of thousands of Britons to help manage their payments and access online banking. While the name is familiar when it comes to credit cards, just like any other provider, there are certain terms and conditions it is vital to note. From today, January 26, 2021, Barclaycard will be altering its terms, and these changes may have an impact on the provider’s customers.

The credit card provider states it will change the way it calculates monthly minimum payments, as well as the interest it charges on cash transactions.

Barclaycard began to write to its customers in November 2020 to tell them about the changes, and how they could be impacted.

The update means some Barclaycard users will have to navigate changes to how they view their payments.

Some may even be required to shift payments upwards to meet the new terms as outlined by the provider.

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Barclaycard is set to use a tripartite measure, and will select the highest of the following three calculations:

  • Two – five percent of main balance (plus any instalment plan payments) – this is individual to each customer
  • Three percent of main balance plus any interest, default fees or account maintenance fees (plus any instalment plan payments) – this is individual to each customer
  • £5, or total outstanding balance if it’s less than £5

The provider, however, has stated the “majority” of customers will not see any changes to their account.

Many are already paying over the minimum monthly payment amount and so will not have to worry about the changes.

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However, it is worth bearing in mind if circumstances change or a person chooses to alter their payments.

Those who are in challenging financial circumstances, including people who have taken a payment holiday, will be excluded from these measures.

Barclaycard has also stressed increases have been capped for each customer. If the new calculation would see a customer pay a significantly higher amount than they are currently repaying each month, these individuals have also been excluded from the changes.

Slightly higher repayments, while a financial change, could in fact be beneficial for customers.

This is because the balance is likely to be paid off sooner, with Barclaycard customers also potentially incurring less interest. 

However, Barclaycard customers will also be affected by a series of other changes the credit card provider is implementing.

In the past, Britons were charged a £12 fee for every month their payment is late, but the new terms mean this will be applied only four times a year. 

Changes will also be made to the ‘over limit fee’, where a similar £12 fee was charged every time a person exceeded their credit limit.

The credit card provider has now confirmed this will be removed for customers. 

Customers will not need to take any action as the changes will kick in automatically from today.

However, if they feel they may struggle due to the new terms laid out by Barclaycard, they are encouraged to reach out to the provider for further assistance. 

A Barclaycard spokesperson told “Barclaycard is a responsible lender, committed to achieving positive outcomes for its customers. 

“We are increasing minimum payments for some customers to help them pay off debt quicker, and reduce the overall interest they pay. 

“This is part of our ambition to ensure no Barclaycard customer gets into persistent debt – where they pay more in interest and charges than reducing their debt, and take a long time to pay this debt off – and is being put in place to support our customers.”

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