Customers jammed bank switchboards yesterday amid fears that they could be left without cash over the Easter break after a computer error at Barclays which will hit hundreds of thousands of people.

The technical glitch has resulted in a five-day delay to salary and other payments. Many people were worried about going into the red and incurring bank charges.

The processing error has affected 20,000 businesses that bank with Barclays, and means that payments - predominantly wages - due to arrive in customers' accounts yesterday will now not show up until next Tuesday.

Many people have direct debits set up to go out on the day they get paid or on the first of the month.

Barclays said it had made arrangements with most of the big banks which meant that by today or tomorrow, those affected would be able to withdraw money from cash machines even if their salary did not show up on their balance.

But despite the bank's efforts to minimise the potential chaos, there were numerous reports of problems. One of the businesses affected, internet training company Wide Learning, said the error had caused havoc. "It meant everyone in our business did not get paid," said Alan Calder, chief executive.

It is a fresh embarrassment for Barclays, which recently hit the headlines over a new multimillion pound pay deal for its chief executive, Matt Barrett, and was previously the subject of negative public ity over its "big bank" TV commercials, rural branch closures and a plan to impose cash machine charges.

The error occurred on Tuesday night and only involves payments that were due to land in accounts yesterday. The timing of the glitch could hardly have been worse - if this had been a normal week there would only have been a 24-hour delay.

Barclays said it had asked other banks to be "sympathetic". Customers of Barclays, Lloyds TSB, NatWest and Royal Bank of Scotland who have been affected should today be able to withdraw cash from ATMs.

By tomorrow the same should apply to account holders with the Cooperative Bank, Bank of Scotland, Nationwide, Clydesdale Bank, Yorkshire Bank and Northern Bank, added a spokesman.

But those banking with HSBC will not be able to get money from cash machines until Tuesday if they go over their limit.

Barclays said it would compensate people if they incurred bank charges as a result of the error.

Guardian

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