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Barclays Bank review: No monthly service fees or minimum opening deposits for online accounts

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This post was last reviewed and updated on July 22, 2021. 

Overall bank rating

Pros and cons

Savings

Annual Percentage Yield (APY)

0.40% APY

  • Pros & Cons
  • Details

  • Pros
    • High APY
    • No minimum opening deposit
    • No monthly service fees
    Cons
    • Must transfer money to external bank to access it
    • Low mobile app ratings in the Apple store
    • No checking account or debit card, so you must transfer funds to an external bank account to access your money
    • Compounds interest daily to maximize earnings
    • FDIC insured

    The Barclays Online Savings Account is a decent high-yield savings option. It pays a competitive APY, but you can find better at other

    online banks
    . Barclays doesn’t have a mandatory minimum opening deposit or charge monthly service fees.

    Accessing cash quickly is difficult with Barclays, though. Because the bank doesn’t have a checking account, you can’t just transfer money between Barclays accounts, then immediately swipe your debit card. You’ll have to transfer funds to an external bank account, which could take a couple of business days. 

    CDs

    Annual Percentage Yield (APY)

    0.10% to 0.25% APY

  • Pros & Cons
  • Details

  • Pros
    • No minimum deposit
    • Low-to-standard early withdrawal penalties
    Cons
    • Mediocre APY
    • Low mobile app ratings in the Apple store
    • Terms range from 3 months to 5 years
    • Early withdrawal penalties are as follows: 90 days interest for terms of 24 months or less, 180 days interest for terms of more than 24 months
    • Interest compounds daily to maximize earnings
    • FDIC insured

     

    The Barclays Online CD has its strengths: Unlike most banks, it doesn’t require a minimum deposit, so you can start with any amount. The bank also charges relatively low early withdrawal penalties should you need funds before your CD matures.

    However, its rates aren’t the best. Yes, Barclays pays higher APYs on CDs than brick-and-mortar banks, but you can find higher rates at other online institutions.

    How Barclays works

    Barclays is an online bank that has a high-yield savings account and CDs.

    Live customer service is available seven days per week, and you can call from 8:00 a.m. to 8:00 p.m. EST.

    The Barclays mobile app is more liked by Android customers than Apple customers. The app has received 4.1 out of 5 stars in the Google Play store, but only 2.3 out of 5 stars in the Apple store.

    Your deposits are FDIC insured for $250,000, or $500,000 for joint accounts.

    Is Barclays trustworthy?

    The Better Business Bureau gives Barclays an A+ in trustworthiness. A strong BBB rating signifies the company is transparent in how it handles business, responds effectively to customer complaints, and is honest in its advertising.

    Although Barclays has a great BBB rating, it does have one recent public scandal. In 2018, the bank paid the US $2 billion for deceiving investors about the quality of residential mortgage-backed securities from 2005 to 2007, causing people to lose money.

    How Barclays compares to competitors

    We compared Barclays to two other online banks that pay high interest rates on savings: Ally and Marcus by Goldman Sachs.

    Barclays review vs. Ally review

    If you’re looking for a bank to open a checking or money market account, then you’ll prefer Ally to Barclays (which has neither).

    You could also have faster access to your money with Ally. Rather than waiting a couple business days for money to transfer to an external account, like with Barclays, you can transfer funds from savings to your Ally checking account and use it almost immediately.

    The banks’

    high-yield savings accounts
    are both strong — no minimum deposit or monthly fees, and both pay a high APY. You might like Ally’s bucket system, though, which lets you save for multiple goals in one savings account, such as “Emergency Fund” or “Vacation.”

    For CDs, Ally is the clear winner. The bank pays higher rates on fixed-rate CDs than Barclays, and it offers two other types of CDs. The No Penalty CD won’t charge a penalty when you withdraw funds before your CD matures. The Raise Your Rate CD lets you increase your rate should Ally’s rates go up during your term.

    Barclays review vs. Marcus review

    Barclays and Marcus have a lot of similarities. Both only offer a high-yield savings account and CDs, and both savings accounts come with high APY, no monthly fees, and no minimum deposit. You’ll prefer Barclays, which has mobile check deposit, if you need to deposit paper checks. Marcus doesn’t have a mobile check deposit tool.

    Marcus does require a $500 minimum deposit for CDs, but if you have the money, you may prefer Marcus to Barclays. Marcus pays higher rates, and there’s a Marcus No-Penalty CD option along with the fixed-rate CD.

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