The regulator – the Financial Conduct Authority (FCA) – found that between April 2014 and December 2018, some customers who had been offered credit were treated poorly when they fell into arrears.
While Barclays has already paid over £273m to at least 1.53 million customer accounts since 2017, it has today been slapped with the £26m fine.
The fine, which includes Barclays Bank UK PLC, Barclays Bank PLC and Clydesdale Financial Service Limited, comes as the group failed in the following areas:
As such, the FCA added that Barclays failed to act with due skill, care and diligence which meant customers facing financial pressures could have endup up making payments on a credit loan at the expense of a priority debt, such as a mortgage, council tax, child support and utility bills.
Further, Barclays identified some of the problems as early as 2014, but due to systems and controls failings, these were not fully rectified.
As Barclays looked to resolve the situation and provide customers with redress, it qualified for a 30% discount on the fine which would otherwise have been £37.2m.
Mark Steward, executive director of enforcement and market oversight at the FCA, said: “Consumers should feel reassured that their lender will work with them to help resolve any financial difficulties, whereas Barclays’s poor treatment of its customers risked making these difficulties worse.
“Firms must treat consumer credit customers fairly, including when they find themselves in arrears. We will take action against unfair treatment, or where firm systems expose customers to the risk of unfairness. While this case predates the pandemic, this message is especially important as the impact of coronavirus continues to affect household incomes and budgets.’
A Barclays spokesperson said: “Barclays is a responsible lender and we strive to achieve good outcomes for our customers. Since the issue was first identified, we have implemented a number of changes to our customer journeys, systems, processes and colleague training to correct it, and the vast majority of customers who were impacted have already been contacted. We would like to apologise to those customers for not providing the level of service we should have.”
Barclays has been fined £26m over the way it treated hundreds of thousands of customers who fell into arrears or experienced financial difficulties.