Barclays Lets Customers Block Drinking and Gambling Payments
New system allows mobile customers to block spending at certain locations
Barclays became the first UK high-street bank to let customers block certain types of payments. The idea behind the move is to allow people, particularly those struggling with addictions, to take control over their spending habits.
Customers who use the mobile banking app can choose to set up the blocks for particular retailers. Once the block is active, any attempted transactions in the specified category will be declined automatically. We look at what this potentially means for the banking sector, and how it might affect customers.
Taking Back Control
The new tools that Barclays have introduced aren’t just aimed at those with addiction struggles. The system will also help those who are having a hard time getting control of their spending habits. Whether it’s through spending too much on shopping trips or over-indulging at restaurants, the feature will allow users to reduce their outgoing expenses.
The system will also help those who are having a hard time getting control of their spending habits.
There has been close attention to the rise of gambling problems in the UK, so this move by Barclays is seen as a positive one. The features are currently available only for debit card customers, although the company promises that the service will be rolled out to credit card users soon. The bank also hopes that the service will help vulnerable customers avoid card fraud and similar scams.
The First High-Street Bank
Barclays is the first high-street bank to make such a move, but the technology itself isn’t new. Online-only challenger banks such as Monzo and Starling already have similar mechanics built into their apps. It remains to be seen whether other banks will also adopt similar services, but it’s highly likely they will. As challenger banks continue to grow in popularity, high-street institutions need to keep up with the pace.
According to an article in The Guardian, Barclays worked closely with the Money Advice Trust and looked at research gathered by the Money and Mental Health Policy Institute to come up with the service.
They identified a range of customers who would benefit from such a block on their finances. This included people with gambling addictions, as well as those with mental health issues.
It will be interesting to see how effective the service is for Barclays. In principle, it seems like a useful feature that savvy savers and those needing help controlling their spending habits could use. There is some precedent already. Monzo report that, with their similar tool, they saw a 70% reduction in users’ spending on gambling. There has also been a variety of testimonies from people who have benefited from using the service.
Gambling can be problematic for some people. Taking on debt to fund the habit can be a costly and slippery slope. Once you have bad credit against your name, it can impact your credit file for up to six years. These new tools signal progress in helping people deal with such problems.