Barclays is withholding hundreds of thousands of pounds in interest from customers who have applied for its market-leading cash Isa, due to administrative delays.

Loyal customers who have banked with Barclays for years as well as new clients are being made to wait months for the bank to pay interest on its Tax Haven cash Isa, which pays 6.5%, sparking anger from consumer groups.

The Sunday Times has been inundated with complaints from readers who applied for cash Isas with Barclays, which is facing a huge backlog for the third year in a row, while forums on consumer websites have been flooded with angry posts from the bank’s Isa customers.

One of those affected is Zofia Hockin, 60, a complimentary therapist, of Crystal Palace, south London.

She complained that she was losing money due to the delay with processing her Tax Haven Isa application and received £15 compensation.

Hockin said: “After realising that my cheque for £3,600 which I submitted on April 18 still hadn’t cleared a month later, I saw that I had lost £18 in interest — that’s a dirty trick as they had prevented me going elsewhere with the promise of such a good rate.”

She added: “They sent me a cheque to compensate for the waiting, and the inconvenience, but I am still angry. The branch seemed shortstaffed and the adviser appeared overworked.”

Another couple who applied to transfer £7,200 in total have been waiting more than two months — a loss of more than £50 interest.

Consumer groups said the Isa is simply a ploy to get customers into branches, which is the only way to open an account.

Martin Lewis of popular consumer website Money Saving Expert, is threatening to blacklist the accounts.

Lewis said: “For the past two years, Barclays has had the market-leading Isa rate, but applicants continue to suffer problems. Either Barclays has abominably poor management, or this product is just a ploy. It drags in non-customers to its branches to sign up and when there, staff try to foist a ‘financial review’ on them — that’s a thinly disguised sales pitch for its other, usually poor, products.”

He added: “If it launches another killer rate deal next year, I will be flagging it up on my site with a big warning.”