Barclays closes small business accounts leaving struggling companies without access to funds

Barclays closes raft of business accounts leaving struggling small companies without access to funds

  • An influx of readers have told This Is Money their accounts have been shut
  • Have you been affected? Get in touch 

A number of Barclays business customers have been told their their accounts have been frozen or closed entirely, leaving them without access to funds, This Is Money understands.

An influx of Barclays business customers have written to This Is Money claiming their accounts have been closed without warning.

This comes after The Times reported the bank had struggled to open new business accounts for more than four months.

Shut out: An influx of This Is Money readers have told us their Barclays business accounts have been frozen or closed

It is understood Barclays writes to customers thee times by post, via alert banners on online and mobile banking, and reminder texts and emails.

If a customer does not reply following this, they have 50 days before Barclays closes their account.

However one reader told us staff at her local branch told her the first and final letters had not been sent at all, and she had not received the second.

The postal strikes are likely to have had an impact on the timely delivery of such letters but our reader also claims she received no notification via online banking.

She also claimed branch staff had told her Barclays’ phone lines had been blocked because the bank had been inundated with calls.

‘We’ve lost a week of work, which in the current economic climate is terrible for us, I can’t tell you how stressful it is, and we’re still not out of it,’ she said.

A Barclays spokesperson said: ‘As part of our ongoing responsibility to help prevent financial crime, and to meet our regulatory obligations, we are required to keep up to date information regarding our customers’ accounts. 

‘We write out to customers asking them to supply us with some important information relating to their Barclays Business account. 

‘In cases we do not receive a response with up to date account information, we are required to proceed with closing the account, so it is very important that account holders respond to these requests from their bank.’

It is understood this only affects business customers and not personal accounts.

Why do banks close accounts? 

 To prevent fraud and protect themselves against losing money, banks have the right to freeze and forcibly close accounts, often without warning.

This is part of the standard small print that customers sign up to when they open an account.

There are multiple reasons why a suspension or account closure might happen.

A business may have been deemed to have breached a credit agreement with the bank, for example, or a freezing order may have been obtained by one of the company’s creditors.

In more serious cases, the bank may have obtained evidence of fraud or money laundering.

The bank is usually not required to give a detailed explanation when it closes an account.

Have you been affected? Get in touch

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