Barclays warns of letter going out to customers over 'significant reduction'

has issued a warning about a letter going out to customers after an individual got in touch about a change to their account.

The frustrated customer contacted the bank over social media, to say: "Despite never exceeding our overdraft limit, never being persistently overdrawn, today you significantly reduce our overdraft limit."

The individual thought the change was particularly unfair given the financial struggles people can have around this time of year.

They said: "In what is possibly the most stressful financial month. Oh and sending a text out after your lines have closed? Cynical move."

Barclays replied to say that it carries out annual overdraft limit reviews to "make sure that the limit is still appropriate".

The bank also advised that there would likely be a letter going out to the customer. They explained: "You should also receive a letter to advise of the outcome of the review, but we do sometimes send a text message to let customers know in advance."

Barclays further explained: "Normally you can view letters in the statement and document section of the app and online banking, they'll show within two working days of being issued."

The provider also apologised for the distress caused and directed the customer to about mental health support.

The interest rate for overdraft amounts with Barclays is currently 35 percent. Interest is charged on any arranged overdraft you use, up to the agreed limit.

For example, the cost in interest of borrowing £500 would be £2.88 over seven days, £12.45 for 30 days and £25.21 for 60 days.

The charges apply for each day you are overdrawn and will be charged to your account on a monthly basis.

Some overdrafts are arranged so you have an interest-free amount, in which case interest will only be charged for amounts over this limit.

If your arranged overdraft has an interest free amount, interest is calculated on the amount of overdraft you use above your interest free amount.

If you do not have an arranged overdraft in place but you spend more money than you have in your current account, there is no interest to pay.

Customers should note that having an overdraft could affect your credit score.