BARCLAYS has angered customers by slashing the amount they can transfer online to external accounts to just £1,000.

The change affects all payments made to third parties that the bank does not recognise as a business entity, meaning that customers wanting to transfer large amounts to another account must now call up to initiate the transaction.

It also means that any customers who have set up transfers to companies as regular payments, rather than bill payments, will have to change them if they want to pay more than £1,000.

Barclays current-account holder John McAdams realised this only after a protracted row with the bank, which initially told him he could no longer pay his monthly credit-card bill online because it was over £1,000.

He said: “I use a credit card for my work expenses and also buy as much as I can on the card so that I can benefit from the cashback facility. My credit-card bill, which I always clear in full, is therefore often more than £1,000 a month.”

The 39-year-old account director from Cardiff added: “I had always been able to pay it online before and was very annoyed when I was told this would no longer be possible. What is the point of online banking if you have to phone the bank every time you want to move your money around?”

Barclays argues that it has lowered the online-transfer limit to protect customers from fraud, and that McAdams will still be able to pay off his credit card online if he registers the transfer as a bill payment.

The bank’s Andrew McDougall said: “We have reduced the limit for external transfers from £2,000 to £1,000 as part of our anti-fraud measures, but the limits are likely to continue to vary over time.”

Banks are under no obligation to impose the same online transfer limits and often reduce these limits if fraudsters target their customers.

Andy Muddimer, head of internet banking at Alliance & Leicester (A&L), said: “If a bank is attacked by fraudsters, it will try to mitigate the effects of that in a number of ways, one of which is to reduce the amount customers are allowed to transfer over the internet.”

Barclays’ decision to lower its limit is a reaction to a recent “phishing” raid. This is when a fraudster sends an e-mail to a user, falsely claiming to be an established legitimate enterprise, in an attempt to scam the user into surrendering private information that will be used for identity theft.

But even Barclays’ previous external transfer limit of £2,000 is lower than that of most of its competitors.

A&L, which last week introduced new online security measures, allows customers to transfer up to £25,000 between their A&L accounts, but restricts those moving money to external accounts to £3,000 a day.

NatWest and Royal Bank of Scotland allow customers to transfer £10,000 a day, whether they are moving money internally or externally. HSBC allows customers to move the total balance of their account to another HSBC account, and permits external transfers of up to £10,000.

Lloyds TSB lets online customers transfer £10,000 a day externally but permits unlimited internal payments.

ING Direct and Birmingham Midshires allow unlimited transfers. But Intelligent Finance which, like Birmingham Midshires, is an offshoot of HBOS, has a £10,000 limit.

The big banks, including Barclays, offer online customers a guarantee that losses as a result of fraud will be covered as long as the customer is not found to have acted negligently.