Barclays customers generally get a poor deal for bonuses and freebies compared to other banks, so how do the Blue Rewards scheme match up?
With the news that Barclays is increasing the monthly fee for it’s Blue Rewards scheme in August, I’ve taken a look at whether it’s worth switching for – or even staying with Barclays if you’re already a customer.
I’ve written a few times before about why you really should think about switching banks. I’m thousands of pounds better off since I first switched back in 2014 (and again many times since). And the bank I switched from? Yup it was Barclays. And I’m not alone at moving away.
Every month since the switching service was launched people have been leaving Barclays in droves. The last official figures show 20,344 people switched away between October and December 2018, but only 13,946 joined. Though that’s a smaller net loss than in previous quarters, it’s a pattern that goes back until at least 2015, if not earlier.
So why are so many people deserting this bank? Well there few benefits you get for sticking. And even less incentives for joining. There’s no high rate of interest or regular savings accounts, no cash back on bills, and no big cash bonus. But you can get all of those elsewhere.
In fact the only extra Barclays offers are the Blue Rewards.
What are Barclays Blue Rewards?
For a monthly fee of £3, Barclays will give you up £7 a month to your current account. This is made up of £3.50 for each of your first two Direct Debit payments. So that’s £4 profit each month.
But Barclays has just announced the fee will increase to £4 on August 2nd 2019, cutting the money you make to just £3 a month.
For most current account customers this means you get £84 a year in rewards but pay £48 in fees, leaving you with £36 profit. Which is ok. But it’s not great.
Yes, it is possible to earn more – but most people won’t. In fact the bank seems to have stopped claiming you can get £180 by joining. The additional top-ups you can earn if you have other Barclays products are:
- Up to £3 a month if you have buildings or contents insurance with Barclays
- £5 a month if you have a mortgage with Barclays
- £1 a month when you have a loan with Barclays
There are also additional cashback rewards with selected retailers. These aren’t bad, though often they aren’t more than 1%, so you can match or beat this with an Amex credit card.
You can occasionally get more, whether you’re a new or existing customer. For example when I switched back to Barclays a year ago (when my Lloyds account interest was cut), there was a deal for new customers to get double rewards for a year – making me £132 in that first year. If you’re new to Barclays it’s certainly worth waiting for something like this. I’ll update my bank switching deals page with any offers that come along.
How to get Barclays Blue Rewards
Compared to other banking rewards it’s a bit convoluted.
First you need to sign up to Blue Rewards, which you can do from your online banking.
Then, to get the £7 a month, you need to pay in £800 every month, have two Direct Debits and use either online or mobile banking.
Do all of those and you’ll be given £7 credit into a digital Rewards Wallet. To access the money you need to transfer it out of your rewards wallet. You do this via your online or app banking.
Are Barclays Blue Rewards worth it?
The Blue Rewards wallet is all a bit complicated. Surely it would be a lot easier to just give customers the money straight into their account, as Halifax does with its Reward account? Maybe it’s to get everyone used to paying a fee!
Regardless, it’s how much money you make which really counts. Remember most customers will only be eligible for the £7 a month before the fee – don’t believe any marketing that says you could make £16 a month.
Anyone considering switching to Barclays can get better than £36 for switching bank so it’s low down my list. The only exception here is if you time your switch during a double rewards promotion.
Of course, if you already bank with Barclays and don’t want to change your account, then this is a handy extra £36 without you really having to do much. So you absolutely should sign up, even with the price increase. However, if you’ve not used up the different switching bonuses available at other banks then I’d encourage you to consider switching as you can get as much as £175 elsewhere – more if you have savings.
For me, well I’ve still got a few months left of double rewards, and when that ends I’ll keep the account open. £36 is better than nothing and since I’ve used up all the different switching offers over the last five years there’s no one else to move to!