Supporting our customers during the rising cost of living

With customers concerned by the rising cost of living, and many facing financial pressure, Matt Hammerstein, Barclays UK CEO, discusses how Barclays is “making sure our customers have the best support possible” at this critical time, including launching the new Barclays Money Worries Hub.

Much of Matt Hammerstein’s time during his first three years as Barclays UK CEO has been spent supporting customers through the COVID-19 pandemic. But since earlier this year, his focus has shifted to what further assistance the bank can provide in the face of the rising cost of living.

“This situation is very different from the pandemic, which hit everyone all at once in a similar way,” Hammerstein explains. Instead he says, “we have to tailor things much more to individual circumstances.”

Responsible for all of Barclays’ retail operations (including savings, investment, and wealth management) and business operations in the UK, Hammerstein is overseeing action at all levels to ensure customers get the support they need. 

Hammerstein explains how the bank is deploying two key approaches to supporting businesses and customers alike.

First, he says, “we’re making sure customers have access to important information they need to help their situation”. Second, “we’re reaching out to customers proactively” when they have been identified as at risk or in need of targeted support.

The latest example of this first step is the new Barclays Money Worries Hub - a dedicated site where customers can find simple advice around managing finances.

“We’re bringing market-leading content together with guided advice for those under particular financial pressure – who might find help in changing spending habits or manage their money differently to help make ends meet.”

The bank is also running free budgeting workshops hosted by Money Mentors, offering confidential and practical guidance on financial planning to help customers track and feel more in control of their monthly spending.

The ethos of empowering customers with the information they need to make the best decisions for their finances is not a new one for the bank. “We’ve been investing a lot over the past eight to 10 years in making it easier for people to feel self-confident to control their money through the digital capabilities that we have in place.” But as Hammerstein explains, the cost of living pressures have “brought these capabilities to the fore.”

He calls out three practical tools customers and businesses can access via the Barclays app: Spending profiling grants a better understanding of a customer’s total outgoings, Spending insights shows how their spending compares to others and where there are opportunities to spend less. Meanwhile, a calendar view tool also allows people to “anticipate when they might have a shortfall to better manage spending or income.”

When it comes to offering proactive support to customers who are or could be at risk of serious financial issues, in Hammerstein’s view, Barclays is uniquely placed.

“We have a lot of data on customers’ incomings and outgoings,” which he says “gives us the opportunity to be able to assess millions of individuals and thousands of businesses each month.”

Thanks to this, the bank can determine which customers may struggle to make ends meet because they’re at risk of eating into their current account balance or going overdrawn. He explains the bank is reaching out to these customers through a range of different channels including email, letters and SMS, to open a “two-way interactive conversation” so advice and support can be tailored.

He believes the “combination of tools and the self-help that’s available can change the dynamics in customers’ ability to take control of their finances.” 

Hammerstein says that he is focused on the bank’s commitment to support UK businesses. He reveals more than 400 Business Health Pledge Masterclasses have happened so far, helping 10,000 clients. These masterclasses aim to inspire, “conversations about ways in which businesses could think differently about their cashflow and optimise that to better manage their situation”. Another 200 plus masterclasses are planned before the end of the year.

Business customers also have access to the Digital Business Health Hub, which gives enterprises access to advice, tips, guidance and tools to help manage their cashflow.

“We’re getting customers and clients talking, so they learn from each other. If we can enable that, it builds trust and increases our ability to connect them with others who can help,” adds Hammerstein.

The bank is also ensuring it can proactively support business clients facing significant pressure.

“We’re investing significantly in growing our financial assistance teams, expecting to nearly double the amount of capability we have to support businesses, ready to be on hand should they run into some form of financial difficulty.”

Alongside this, Barclays has joined with other major UK banks and big businesses in offering eligible staff a cost of living payment.

In cases where customers are facing the most acute financial pressures and need more intensive support, the bank is partnering with several organisations to provide specialist interventions.

Hammerstein points to one specific case where a mother with two young children, who had recently separated from her partner and left her fixed address, was facing financial hardship. After being contacted by the bank, she was referred to the charity Turn2Us and the government’s Universal Credit scheme: “We were able to talk to her to signpost her to specialist support, which helped bring her income up and better helped her make ends meet.” Barclays is also now working with the charity to promote their benefit calculator within the website.

More widely since 2020, the bank has worked to support communities across the UK. Through its partnership with Family Action, it has provided 2,800 grants to families and individuals in particularly difficult financial circumstances. The charity has been a key partner in delivering the bank’s LifeSkills programme to help people enhance their employability skills and improve their financial education.

Looking at the range of actions being taken, the Barclays UK CEO says that the bank is “trying to find ways to provide open support, but at the same time tailor it”.

He pays tribute to the “tremendous amount of experience and perspective” and is clear that “prioritising support for existing clients is fundamentally important.” 

Ultimately, he hopes this approach can overcome what he calls “the stigma that banks are only getting in touch with customers for their own interests,” whereas Barclays “really is focused on making sure our customers have the best support possible.”