We don't like Barclays' rate cuts

High street giant Barclays this week slashed rates on its interest-paying current accounts in a move hardly designed to encourage thrift among the young.

The accounts are specifically targeted at people aged 16 to 19 and before the cuts there were four tiers paying reasonably attractive rates.

For £250 and above the interest rate was 3%. For more than £100 it was 2.5%, and 2% was paid on £10 and above. But now Barclays have slashed rates to just 1% across the board.

A Barclays spokesperson said the move is to encourage young people to take out savings accounts instead. But the alternative offered, the Reward Saver, pays interest depending on the number of withdrawals a year, with rates of only 0.15% to 2%.