Barclays current account overhaul

Kevin Mountford, head of current accounts at price comparison site moneysupermarket.com, said: "Barclays says its new current account will cause a stampede of applications, but it's far more likely to be nothing more than a damp squib.

"The only Barclays accounts giving a decent in-credit interest rate are still those that have interest-busting monthly fees.

"People have consistently shown they prefer the current system of punishing those who transgress rather than penalising everyone with small transaction fees or monthly fees.

"This move of Barclays to reduce overdraft charges with the one hand and credit interest with the other is a direct result of the work the OFT has been doing and something we have been warning about: If overdraft charges are to fall as the OFT wants, consumers will pay somewhere else.

"The big question is whether this is effectively the first climbdown by one of the major banks in the face of the OFT ruling - an admission that its overdraft charges were too high in the first place? It will be interesting to see what moves the other big banks make now."