Barclays new Blue Rewards hands cash to customers. What’s the catch?

Joining Barclays Blue Rewards costs £3 a month but then lets customers in for handouts of up to £15 a month

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Barclays customers can cash in from a new handout from the bank from next Monday. Joining Barclays Blue Rewards costs £3 a month but then lets customers in for handouts of up to £15 a month.

You’ll need to have a suitable Barclays current account with at least £800 paid in every month and two monthly Direct Debits paid out to qualify. Once signed up you’ll get £7 a month paid into a Digital Wallet which can be transfered to your current account, giving £4 a month to all those who join. To get higher monthly rewards, you’ll need to have a mortgage or insurance with the bank.

“The £7 monthly payment is money for nothing although in effect you're only getting £4 once the £3 monthly fee is taken into account,” pointed out Andrew Hagger of Moneycomms.co.uk. “I'm not sure why there's this give with one hand (£7) and take with the other (£3 fee), although perhaps offering a straight £4 payment would make it more obvious that it's less rewarding that the Halifax £5 per month?”

Halifax pays £5 per month to customers while Santander’s 123 account -which charges a £2 monthly fee - offers credit interest and cash back on utility direct debits which can add up to a sizable amount.

“There are further monetary rewards up for grabs from Barclays if you have or take a Barclays mortgage or home insurance. But however convenient it may be to have all your financial products under one roof, you could end up paying over the odds by not shopping around,” warned Mr Hagger.

“By buying these products elsewhere you may be able to save more than the £60 and

£36 you'll receive each year for keeping your mortgage and home insurance with Barclays.”

Meanwhile David Mann, money expert at uSwitch, added: “Barclays does appear to be missing a trick by not including its credit card customers. It’s also important to note that customers have to be signed up to either online or mobile banking to benefit – which could see some people miss out.”