Banking giant Barclays recently announced huge profits for the year despite the turbulence in the financial and banking sectors, and also said that it had put £1.5 billion aside for staff bonuses for this year.

However, despite its apparent financial success the High Street bank has announced that it is hitting two million customers with increases on overdraft charges. This means that around one fifth of the bank’s customers will be affected by the interest rate hikes, which are set to be put in place from the end of April of this year.

The affected customers will be shocked to learn that the rates that they are being charged on their overdraft could go up by as much as 5 percent. The move to increase the rate on overdrafts for these customers has been criticised by campaign groups, particularly in lights of the fact that the banking giant has reported a 92 percent jump in pre-tax profits.

The fact the base interest rate is also still at an all time low of just 0.5 percent makes the move by Barclays questionable too.

The biggest overdraft rate increase will be seen on the Graduate Additional Account from Barclays, where the rate of interest is set to increase from 9.9 percent to 14.9 percent for authorised overdraft borrowing. The Additions Active account and the First Additions Account will both see the rate of interest increase to 18.3 percent, reflecting an increase of 3.4 percent.

A spokesperson from the consumer campaign group, Which? stated: ‘The base rate hasn’t gone up and Barclays have just announced bumper profits, so many of their current account holders will be angry at this sudden increase in overdraft rates. Barclays customer who’s unhappy with this rate hike should vote with their feet by shopping around and switching to a current account that best suits their needs.’

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