Barclays Bank Review
The Barclays Bank is great for building your long term savings. There are no checking account services, but the savings and CDs help you earn compound interest rates when you avoid withdrawing money regularly.
Barclays Bank is a great place to plan savings for long-term goals because of its high-interest savings accounts and certificate of deposits. Barclays does not have any physical branches in the U.S., which may limit your access to your funds.
On Barclays Secure Website
Because Barclays focusing exclusively on savings accounts and CDs, you help you organize and develop long term and short term savings goals. All of Barclay's banking products perform best when they are left untouched, especially you're CDs, which have steep penalties for customers who withdraw money before the end of the CD term.
Even though there is no physical ATM or branch accessibility this will not be a problem in the long run because your money remains in one place for you to save.
Here are the main products Barclays bank offers for savers:
Bank Reputation - Customer Ratings, Financial Strength
- A+ on BBB – BBB assigns ratings from A+ (highest) to F (lowest). BB ratings are based on information in BBB files with respect to factors such as business's complaint history with BBB, type of business, time in business, transparent business practices and more.
- 1.4/5 on Trustpilot ( 4304 reviews) – TrustScore is also an overall measurement of reviewer satisfaction, represented numerically from 1 to 5.
- Moody’s, Standard & Poor's (S&P) and Fitch – top three credit rating agencies in the world:
- Moody's: A3 – Moody's rating scale running from a high of AAA to a low of C.
- Fitch: a – Fitch rating scale running from a high of AAA to a low of D.
- S&P: bbb+ – S&P rating scale running from a high of AAA to a low of D.
- J.D Power Research – We considered J.D. Power’s national banking satisfaction study 2020.
J.D Power offers the most comprehensive and independent study of customer satisfaction. The study aims to help consumers and issuers to understand user opinions and ratings of the largest bank in the country. It covers customer satisfaction, products, fee structures, digital customer experience, transparency and more.
Barclays offers high-interest rates that apply to all of its products that provide a great advantage compared to other competitive online banks. Barclays offers two different savings account options. The two options are the Barclays Online Savings Account and the Barclays Dream Account. Both earn 0.60% APY with no fees or minimum deposit.
The Dream account earns more interest over time. You can potentially earn a 5% bonus on earn interest every six months so long as you avoid any withdrawals and make one deposit a month. This is a great option for anyone that is smart with the savings and can keep themselves engaged with the overall process of long-term savings.
There is no other bonus offered to other savings accounts to any other online banking institution. The Dream Account does put a limit on your monthly deposits. You can only deposit $1,000 a month. If you make zero withdrawals and deposit the maximum $1,000 every month you still need to keep the same pattern for a full year for the benefits to kick into effect.
This maintaining of your savings is a significant commitment to many customers and requires a great deal of organization to maintain its full effect. If you are saving more than $1,000 a month you should add a second high-yield option like a Barclay’s own Online Savings Account.
Certificate Of Deposits (CDs)
The other savings option Barclays offers is a CD with above-average interest rates compared to other online banking institutions. Barclays falls behind slightly in shorter-term lengths but stays ahead in their multi-year CD options.
Barclays CD terms are slightly better if you are interested in a three month CD term, but the rates are mostly equal to or lower than Ally Bank and Capital One. The highly recommended plan is only to open a CD at the same time as your existing Barclays savings account. This makes it easier to manage your money and make transfers when you need to.
Barclays Compared to Other Banks
Because Barclays is an online bank in the U.S. it is best to compare to other exclusively online banking financial institutions through websites or mobile services. The four main competitors against Barclays are:
- Ally Bank
- Capital One
- Goldman Sachs Bank USA
Ally Bank is a direct competitor to Barclay because of their shared online banking preference. Ally Bank offers a larger range of products and services compared to Barclay. Ally offers checking accounts, credit cards, mortgages, and auto loans, which contrasts significantly with Barclay.
Barclay only offers CD terms and savings accounts. Alongside those differences, Ally allows for nationwide ATM access, and better interest rates compared to Barclays, making Ally Bank is a large competitor in the only banking industry.
HSBC is another competitor because of its larger physical presence because Barclay is only operating in the U.S. as strictly in an online-only way. HSBC operates similarly with its standard fee structures and rates of physical banks.
HSBC provides adequate in-person banking and ATM access, but their interest rates are significantly lacking compared to Barclay. For instance, HSBC savings accounts require at least $100,000 in deposits and amount to just a few basis points. HSBC customers will likely earn between 0.01% or 0.05% on their savings accounts, which is a relatively smaller amount compared to Barclays.
Barclays Competitors Explained
Capital One is a competitor for potential Barclay's customers because Capital One provides physical branches and strong interest rates, which Barclays is not able to offer its customers. Capital One 360 is the online banking tool that helps you earn 1.30% APY on your balance, which is significantly smaller than either of Barclay's savings options.
Another key difference between Capital One 360 and Barclays is the addition of their checking accounts with debit cards and ATM withdrawals, which are unavailable services with Barclays.
Capital One also provides you with credit cards and loans through their physical branches, which makes the banking experience more expansive, which is something Barclay is lacking.
The last main competitor for potential Barclays customers is Goldman Sachs. Goldman Sachs offers a high yield online savings account that earns 0.60% APY on any amount you deposit. There are no monthly fees or minimum balance requirements.
Goldman Sachs also has a higher maximum deposit amount ability. You can keep up to $1,000,000 in your savings account and earn the full rate, which is a much bigger amount than Barclays can provide.
Access on the GO
A great feature for Barclays customers is the ability to access their accounts through the Barclays U.S. Savings mobile app. This is available for most users and features a mobile check deposit feature. You can make deposits with pictures and then uploading them onto the mobile app.
You can also access your account balance and make one-time transfers using the Barclays app. This is a great tool for managing your finances with unlimited accessibility.
Alternatives Banks For Consideration
Here are our alternatives to Barclays Bank:
Live Oak is one of the popular banks in the country, having had its beginning in Wilmington, North Carolina in 2008 – which remains its only physical branch to date. Today, they are a nationwide bank in terms of reach and is the 246th bank in terms of size in the United States.
They started out as a bank that catered to a very select market: veterinary services. But now, they have expanded their reach across multiple industries with a distinct focus on small businesses. A stiff pre-qualification process ensures that only the ones with the strongest financials from specific industries make their loan client list. Borrowers should have a credit score of not less than 550 to be able to qualify.
In turn, Live Oak offers low-cost loans to help these businesses with their funding needs. However, borrowers must follow the guidelines on how they will use the proceeds.
The bank offers competitive deposit rates and often pay higher interest than their competitors. Because they are practically an online bank, they don’t have the expenses that come with an extensive banking network. This enables them to give out an above-average APY to their depositors.
The bank is digitally-focused – which, to them means banking is available only through an online and mobile app. Their mobile app can let you see even your non-Live Oak account. Currently, customers have no ATM access but the bank reports that they are working on it.
Customers can contact their help desk by phone only Monday to Friday during office hours. Or they can communicate by leaving a message on the bank’s website.
Citibank is a well-established bank that offers numerous investment plans and financing services. Such as; business accounts, personal accounts, commercial accounts, mortgages, credit lines, personal loans, and home loans.
For small business accounts, the options available are the Insured Money Market Account (IMMA), Savings Account, and Certificates of Deposit (CD). Funds are easily accessible, and a $1 minimum deposit fee in the IMMA and Savings Account while the CD is fixed for future profit.
You may need to provide some certifications to open any of the accounts, like a Government-issued means of identification, tax identification number, business name, and the number of employees.
The Bank may also require everyone involved in the business to fill out some personal and public details, including; name, date of birth, contact address, home address, countries of residence and citizenship, taxpayer identification number, and ownership percentage.
A significant disadvantage of banking with Citibank is the many transaction charges for withdrawals, money orders, wire transfers, statement of account, returned cheques, overdraft protection transfer and account closing.
This feature is a significant turnoff for clients because these fees may compile to a substantial amount.
JD Power in 2019 gave Citibank four out of five stars for their mortgage offers, and a top spot for customer satisfaction in 2020; these ratings are much higher compared to its contemporaries.
However, the Better Business Bureau gives Citibank an F for organizational performance.
London-based Barclays provides banking services to 48 million people worldwide. The U.S. banking system is online-only. This banking service offers very good annual percentage yields on savings accounts and CDs, but there are no checking accounts. This may be a significant disadvantage for many potential customers.
Another thing to consider is that there is no physical U.S. branch network, which may be a hindrance for some customers who enjoy in-person interactions, but for many, this is not a problem. This financial system is great for account holders at any balance level, long term savers who make few withdrawals, and users comfortable with online banking
Overall if you value high savings rates you may overlook these financial system physical limitations you will be pleased with their various features and banking tools that offer strong interest rates on their savings and CD accounts.