Is it worth adding the fee-paying extra to your Barclays current account?
Barclays customers generally get a poor deal for bonuses and freebies, and the Blue Rewards scheme has been pretty poor compared to other banks.
Since 2022 the bank has offered a 5.12% AER rate on savings for account holders, and now added up to 15% cashback. I’ve taken a look at whether it’s worth signing up.
** UPDATE 1/11/23 – There’s a new £175 bank switch offer running until the end of the month. Here’s more **
What are Barclays Blue Rewards?
Barclays Blue Rewards is an add-on you can choose to put on your Barclays current account.
You’ll get a monthly reward, money back on specific Barclays products (mortgages, home insurance and loans) if you meet some basic criteria and pay a monthly fee. There are also extras such as prize draws and exclusive savings accounts.
Barclays Blue Rewards requirements
First, you have to have a Barclays current account. You can’t get Blue Rewards if you already have Barclays Avios Rewards, though you can change over.
You’ll need to pay a monthly fee, which is currently £5 a month. This makes it one of the most expensive add-ons for current accounts.
You also need to have two Direct Debits leave the account each month. I’ve written here about some easy and fast ones you can set up if you’re short of these, though I’ve always put some ongoing charity donations on my account.
There’s also the need to pay in £800 a month to the current account, but this doesn’t need to stay in there so you can withdraw it or spend it.
5.12% savings on up to £5,000
This new Rainy Day Saver offers an exclusive rate of 5.12% for Blue Rewards members. Though you can hold up to £10 million there, you’ll only earn the rate on the first £5,000. At the time of writing, this makes it the best paying place to keep your cash.
- Save £500 for 12 months to earn £25.60
- Save £1,000 for 12 months to earn £51.20
- Save £2,500 for 12 months to earn £128
- Save £5,000 for 12 months to earn £256
It’s fully easy access, so you can take out and deposit the money as and when you want. There’s only one account per person, whether that’s in sole or joint names.
To find and open the account in the app, go to the Products tab at the bottom of the screen, click savings, then “see all accounts”. You’ll then see the Rainy Day Saver account to open. You can also open it online, over the phone or in branch.
Note this is different from the Blue Rewards Saver which pays just 1.26% interest as long as you don’t make withdrawals (which can easily be beaten elsewhere).
A monthly Reward (kind of)
The main earner used to be the Reward payment. When it launched in 2015 you got £7 back for a £3 fee, worth £48 a year. Then in 2019 the fee increased to £4, leaving an annual profit of £36.
But since March 2022 you’ll get a £5 reward for a £5 fee, so zero profit. It’s a strange way of doing things!
Extra Rewards if you have other Barclays products
An extra reward is given for having a Barclays mortgage, which currently stands at £3 a month. Those customers will get an extra £36 each year.
There’s 3% cashback on home insurance and £1 life insurance held with Barclays.
When Barclays dropped the cashback feature of Blue Rewards in 2021, it launched some ‘exclusive offers’. These haven’t been particularly exciting so far. There was an offer for one-to-one money coaching, but numbers were very limited and places went very fast. Otherwise it was just a handful of prize draws.
How to get Blue Reward payments
Interest from savings is paid straight into the savings account, so if you have the full £5,000 saved you’ll want to withdraw the extra on top each month and move it to a better paying account.
It’s different however for the other Rewards. If you meet all the requirements, the £5 bonus cash and any mortgage or insurance cashback is not paid directly into your current account. Instead it goes into a digital Rewards Wallet. To access this money you need to transfer it out of your Rewards wallet. You do this via your online or app banking.
I think 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? Just remember to move this money each month too.
Are Barclays Blue Rewards worth it?
Blue Rewards have always been the poor cousin to better schemes from Halifax and Lloyds, and even Natwest/RBS.
The changes earlier in 2022 put not just Blue Rewards, but also Barclays, right at the bottom of the pile.
But the new 5% savings account could be worth up to £256 a year, making it the most profitable offer from the banks – as long as you have £5,000 to save.
So, yes if you can take advantage of the high interest it’s worth signing up. Just be aware that other accounts could match or beat that rate, so keep an eye on your options.
Of course, if you’re worried about the ethics of banks you save with, then Barclays is one of the worst out there.
How to sign up for Barclays Blue Rewards
First, you need to have a Barclays current account. Once you’ve got this, you need to sign up for Blue Rewards, which you can do from your online banking or the app.
How to cancel Barclays Blue Rewards
If you decide you don’t want to continue with Blue Rewards you can easily cancel it in your online or app banking. I did in on the app in just a few seconds.
- Open up your app and choose Blue Rewards from the home screen
- Scroll down to the bottom of the screen
- Select “Leave Barclays Blue Rewards”
- Tick the box at the bottom of the screen
- Press the “Confirm” button
Any money you have left or pending in the Blue Rewards wallet will be moved to your current account. If you wish to rejoin you’ll have to wait at least two days.
Alternatives to Blue Rewards
Barclays isn’t the only bank to offer extras, and many have benefits without having to save any money. You could choose to switch your account to a different bank (and maybe nab a switching bonus) or you can simply open up extra current accounts. Here are my picks and links to reviews with further details: