A savings account is a great place to park cash for an emergency fund, a short-term financial goal, or a down payment on a house or car. Online savings accounts typically offer higher interest rates and less fees than the savings accounts offered by traditional brick-and-mortar banks, and the Barclays Online Savings account is one of the most competitive available.
Barclays is a large international bank with headquarters in London that has offered a U.S. savings account with a consistently competitive interest rate for years.
You can deposit checks online, transfer money to and from your account easily through their mobile savings app, and make unlimited transfers. Barclays doesn’t have ATMs in the United States, so it’s best for long-term savers who can just let the interest grow.
- 4.35% APY
- No minimum balance
- No annual or maintenance fees
- No fee-free ATM network in United States
What is Barclays Online Savings?
Barclays Bank PLC, the company behind Barclays Online Savings, is a London-based international bank launched in 1690. Today, the company offers banking services to 48 million customers worldwide, and its U.S. division is based in Philadelphia.
Because the company has an American arm, US customers don’t need to deal with currency conversion or any complicated tax scenarios when they open an account. Although Barclays Bank began in the U.K., it’s not considered a foreign bank for American consumers.
Additionally, much like any other traditional bank, Barclays deposits enjoy FDIC Insurance coverage of up to $250,000 per depositor.
How does the Barclays Online Savings account work?
Barclays Online Savings accounts are online only; accountholders don’t have access to brick-and-mortar bank branches. Not having bank branches allows Barclays to keep overhead costs minimal, and those savings are passed on to customers in the form of a high interest rate and minimal fees.
Barclays Online Savings accountholders can set up automatic deposits or one-time transfers from an external bank account. The account also supports remote deposits, in which you can upload a photo of a check from your computer or mobile device. Accountholders also have the option of making deposits by mailing checks to Barclays’ office in Illinois.
The account allows unlimited withdrawals and transfers, and customer service reps are available from 8:00 a.m.- 8:00 p.m. EST seven days a week.
How much does the Barclays Online Savings account cost?
The Barclays Online Savings account has no monthly maintenance fees or annual account fees. Its most notable fee is a $5 non-sufficient funds fee — in other words, a penalty if you overdraw your account. But keep in mind a $5 fee is far less than the $30+ mainstream banks charge when you overdraw a savings or checking account. Other fees of note include:
- Returned deposit: $5
- Cashier’s check: $5
- Paper statement copy: $0.5
- Rush document delivery: $25
Barclays Online Savings account features
- No monthly maintenance fees
- No minimum opening deposit
- Remote check deposits
- Access to customer service seven days a week
- Mobile app and desktop access
Some particularly good use cases for a Barclays Online Savings account include:
Meeting short-term savings goals
Are you saving for something that costs a few hundred dollars? The Barclays account makes for a great sinking fund. You can transfer a small amount of money into the account each month, and in a few months you’ll meet your savings goal.
Creating an emergency fund
A high-yield savings account like the Barclays Online Savings account is a great place to build an emergency fund. It offers a competitive interest rate, but your funds are still easily accessible if you need them quickly (unlike less liquid avenues, like investing in stocks).
Gathering a down payment
If you’re saving up for a down payment on a home or a car, a high-yield savings account is one of the best places to stash your cash. Unlike investing accounts, where you run the risk of losing your hard-earned funds, the money stored in a Barclays Online Savings account is guaranteed to be safe and accessible even in economically uncertain times.
Who is the Barclays Online Savings account for?
The Barclays Online Savings account is a great fit for those who are comfortable banking online and who already have a checking account with another financial institution.
Who shouldn’t use the Barclays Online Savings account?
The Barclays Online Savings account might not be a good fit for those who are accustomed to banking in person at brick-and-mortar branches, and who are not comfortable banking online.
As a bona fide savings account, it’s not an ideal solution for those seeking a hybrid checking-savings account to handle all their banking needs.
Pros & cons
- Competitive APY — The 4.35% APY is right up there with the best high-yield savings accounts offered in the U.S.
- No account minimums of any kind — Some banks require a minimum balance to open an account or earn at their highest interest rate.
- Minimal fees — You won’t pay any fees provided you use the account as it’s intended, and fees for atypical uses are low.
- Customer service — Barclays reps are available seven days a week.
- Online only — No physical branch or ATM locations in the United States.
- Limited features — No checking account capabilities.
- No chat or email support — Service reps are available by phone or postal correspondence only.
Before signing up for a Barclays Online Savings account, it’s a good idea to check out some of the other high-yield savings accounts competing for your deposits. Here’s a comparison of Barclays with two strong alternatives.
Barclays Online Savings account vs CIT Bank Platinum Savings Account
With no account opening or monthly service fees, the CIT Platinum Savings Account offers a high interest rate on balances of $5,000 or more with a minimum of $100 to open an account. See site for details.
- Up to 5.05% APY
- No monthly service fees
- Fast account opening
- High minimum balance required to earn top rate
Those who can maintain a balance of $5,000 or more with the CIT Bank Platinum Savings account earn a 5.05% APY. See site for details. That’s one of the highest interest rates we could find. There’s no account opening or maintenance fees so you don’t have to worry about eating away your balance (note there is a $100 min. opening deposit to get started).
Your deposit accounts are safe and secure and insured up to $250,000 per depositor as CIT Bank is a division of First-Citizens Bank & Trust Company, a member of the Federal Deposit Insurance Corporation (FDIC). There’s also a helpful CIT Bank mobile app to deposit checks remotely and make transfers.
The Barclays Online Savings account is one of the simplest tools available for saving money. It offers a high yield on your savings and does so without the need to keep a minimum balance or worry about fees.
Barclays isn’t the best option if you enjoy having access to in-person banking, or if you’re looking for a mixed account that offers features for both checking and savings. But if you’re comfortable with a fully online banking experience, it’s a great option.