Barclays Bank customers who fail to keep an eye on their overdraft will face a hefty increase in charges when they bounce payments or if the bank allows a payment that takes them over their overdraft limit.

The new charges are being introduced by Barclays Bank from 31st March:

• Paid Referral fees increase from £25 to £30 (going over your overdraft limit but the bank allows the payment)
  • Unpaid item fees increase from £30 to £35 (bouncing an item)

Customers who have a basic bank account, which does not allow an overdraft, pay a reduced fee of £15 for unpaid items.

Paid referral fees can add £90 to the bills of customers who fail to watch their accounts properly. The first time that an item is paid which takes the account over its limit will be free. Thereafter, the bank will charge £30 each time, although it will only charge once per day, and no more than three times a month.

To avoid referral fees it's crucial to talk to the bank before items leave the account. The bank may be able to offer to increase an overdraft or provide alternative assistance to avoid the charges. As a last resort, consider cancelling direct debits or standing orders that may cause the account to go over its limit - these can always be reinstated later.