Barclays to ‘Save’ Customers £7m a Year on Overdraft Charges Cuts (Photo: Reuters)
Barclays to ‘Save’ Customers £7m a Year on Overdraft Charges Cuts (Photo: Reuters)

Barclays has claimed that it will 'save' customers £7m a year in fees after it reduces its overdraft charges on current accounts.

Currently, banks can charge an £8 levy, when a customer does not have the funds in his or her account to pay for a purchase, up to five times a day. However, Barclays says it will not charge these fees more than once per day.

It added that it recently introduced system of text message alerts when consumers enter their overdraft.

Barclays claims that its 12 million UK current account customers will save a total of £34m (€41m, $56m) this year due to a number of changes to its fees.

The overdraft fee cut is the latest move in a line of measures that Britain's biggest banks have taken to keep existing customers after new rules have allowed people switch accounts within seven days rather than 30.

New rules have also allowed regular payments to be automatic once an account has been switched.

According to data from the research firm TNS in November, when customers switch accounts, they are moving away from the biggest high street banks.

Since Barclays' former chief executive Bob Diamond and a number of senior executives were ousted in the aftermath of the Libor fixing scandal in June 2012, the new leader, Antony Jenkins has sought to overhaul the bank's image.

In February this year, Jenkins delivered details on his 'Transform' programme to turnaround the bank, by sending out a memo to the bank's 140,000 employees saying performances and rewards would be judged against a set of core values, including integrity and respect for others.

Meanwhile, as part of the group's public relations drive, Jenkins was BBC Radio 4 Today programme's guest editor and hit back at critics that dubbed his stint as "self-serving twaddle."

During his early morning stint on Radio 4, BBC business presenter Simon Jack asked Jenkins if businesses have a role in being "responsible" for social leadership.

"Banks are different to other commercial enterprises [as] they have to recognise they have a strong obligation to society," said Jenkins.

"The notion of leadership is often confused with big-scale leaders. Leadership operates on all levels."

"Leaders have to be people who conceive of the world in a better way and are willing to take the risk to make that happen."

In response to his post as guest editor, Jenkins said "I understand there are a lot of people who think this is self-serving twaddle. I thought about it very carefully".