Barclays PLC (BCS): Business Model Canvas [10-2024 Updated]

Discover how Barclays PLC (BCS) leverages its robust business model to navigate the complex financial landscape. With a focus on key partnerships and innovative services, Barclays is positioned to meet the diverse needs of its customers. This blog post delves into the intricacies of its Business Model Canvas, exploring elements such as value propositions, customer segments, and revenue streams. Read on to uncover what makes Barclays a leader in the banking industry.

Barclays PLC (BCS) - Business Model: Key Partnerships

Collaborations with fintech companies

Barclays has established strategic collaborations with various fintech companies to enhance its service offerings and improve customer experience. Notably, Barclays partnered with fintech firm Starling Bank to integrate digital banking solutions, enabling seamless customer transactions and account management. Additionally, Barclays has been involved with Plaid, a financial technology company, to facilitate secure access to customer financial data, enhancing their digital ecosystem.

Partnerships with payment processors

Barclays has formed alliances with major payment processors to strengthen its payment solutions. The bank collaborates with Visa and Mastercard to leverage their payment networks, facilitating efficient transaction processing for both retail and corporate clients. As of 2024, Barclays processed over £200 billion in card transactions annually through these partnerships, reflecting a significant increase in digital payment adoption.

Payment Processor	Annual Transaction Volume (£bn)	Partnership Focus
Visa	120	Digital Payments, Security Solutions
Mastercard	80	Card Issuance, Fraud Prevention

Alliances with regulatory bodies

Barclays maintains active partnerships with various regulatory bodies to ensure compliance and foster a stable financial environment. The bank collaborates with the Financial Conduct Authority (FCA) and the Prudential Regulation Authority (PRA) in the UK, focusing on regulatory compliance and risk management. In 2024, Barclays allocated approximately £150 million to enhance its compliance systems and processes, reflecting its commitment to regulatory excellence.

Relationships with institutional investors

Barclays has cultivated strong relationships with institutional investors, including pension funds and asset management firms. As of mid-2024, institutional investors held nearly 65% of Barclays' total equity. The bank's investor relations strategy focuses on transparency and regular communication, hosting quarterly earnings calls and annual investor days. In 2024, Barclays returned £1.2 billion to shareholders through dividends and share buybacks, further solidifying its relationship with institutional investors.

Investor Type	Equity Holding (%)	Recent Return (£bn)
Pension Funds	30	0.5
Asset Management Firms	25	0.7

Barclays PLC (BCS) - Business Model: Key Activities

Providing retail and corporate banking services

Barclays UK generated a total income of £3,713 million in H124, a decrease of 5% compared to £3,922 million in H123. The breakdown of income showed:

• Personal Banking: £2,302 million, down 8% from £2,497 million
• Barclaycard Consumer UK: £457 million, down 6% from £484 million
• Business Banking: £954 million, up 1% from £941 million

The total loans and advances to customers at amortised cost as of June 30, 2024, were £198.7 billion, while customer deposits were £236.8 billion.

Investment banking and trading operations

Barclays Investment Bank reported total income of £6,347 million in H124, a slight increase from £6,312 million in H123. Key performance indicators included:

• Profit before tax: £2,365 million in H123 vs. £2,178 million in H124
• Return on average tangible equity (RoTE): 10.8% for H124, down from 12.0% in H123

Global Markets income increased by 5%, with Equities income up 24%, while Fixed Income, Currency, and Commodities (FICC) income decreased by 3%.

Wealth management and financial advisory

Barclays Private Bank and Wealth Management generated a total income of £632 million in H124, reflecting a 13% increase from £558 million in H123. The segment's performance was characterized by:

• Net interest income: £362 million, down 1% from £367 million
• Net fee, commission, and other income: £270 million, an increase of 41% from £191 million

The assets under management grew to £119.8 billion, with client assets and liabilities reaching £198.5 billion, a significant year-on-year increase.

Risk management and compliance activities

Barclays maintained a Common Equity Tier 1 (CET1) ratio of 13.6% as of June 30, 2024, reflecting a decrease from 13.8% in December 2023. Risk-weighted assets (RWAs) increased to £351.4 billion from £342.7 billion. The group reported credit impairment charges of £0.9 billion for H124, consistent with H123 levels.

Key Metrics	H124	H123
Total Income (Barclays UK)	£3,713 million	£3,922 million
Total Income (Barclays Investment Bank)	£6,347 million	£6,312 million
Total Income (Barclays Private Bank)	£632 million	£558 million
CET1 Ratio	13.6%	13.8%
RWAs	£351.4 billion	£342.7 billion
Credit Impairment Charges	£0.9 billion	£0.9 billion

Barclays PLC (BCS) - Business Model: Key Resources

Extensive banking network and branches

Barclays operates a vast network of branches and ATMs across the UK and internationally. As of June 2024, Barclays had a total of approximately 1,200 branches in the UK, providing essential services to millions of customers. The bank also maintains a significant presence in key global markets, including the Americas, Europe, and Asia, contributing to its extensive banking network.

Strong brand reputation and customer trust

Barclays boasts a strong brand reputation, consistently ranked among the top banks in the UK. According to a 2024 survey, 72% of customers expressed trust in Barclays, a significant factor in customer retention and acquisition. The bank's commitment to corporate social responsibility and sustainability initiatives has further enhanced its brand image.

Advanced technology infrastructure

Barclays has invested heavily in technology, with over £4 billion allocated for digital transformation initiatives in 2024. This includes enhancements to its mobile banking app, which now has over 10 million active users. The bank's technology infrastructure supports advanced data analytics, fraud detection, and customer engagement strategies, ensuring a competitive edge in the financial services sector.

Skilled workforce and expert financial analysts

Barclays employs approximately 85,000 people globally, with a significant portion comprising skilled financial analysts and banking professionals. The workforce is supported by ongoing training programs, with £150 million invested in employee development in 2024. This skilled talent pool is crucial for delivering high-quality financial advice and services to clients.

Key Resource	Details	Impact on Business
Banking Network	1,200 branches in the UK; global presence in key markets	Increases accessibility and customer base
Brand Reputation	72% customer trust rating in 2024	Enhances customer loyalty and acquisition
Technology Investment	£4 billion in digital transformation	Improves efficiency and customer experience
Workforce	85,000 employees with £150 million in training	Provides expert financial services and advice

Barclays PLC (BCS) - Business Model: Value Propositions

Comprehensive financial services for diverse needs

Barclays PLC offers a wide range of financial services, including retail banking, corporate banking, investment banking, and wealth management. As of June 30, 2024, the total income from Barclays UK amounted to £3,713 million, while the Barclays Investment Bank generated £6,347 million in total income. The comprehensive suite includes personal loans, mortgages, credit cards, and investment services aimed at various customer segments.

Innovative digital banking solutions

Barclays has made significant investments in digital banking technologies. For example, the bank’s mobile app reported over 14 million downloads in 2024, enhancing customer engagement and offering features such as instant payments and financial management tools. The digital transformation strategy reflects Barclays’ commitment to innovation, aiming to improve customer experience and operational efficiency.

Competitive interest rates and fees

Barclays maintains competitive interest rates, particularly in its savings and lending products. As of June 2024, the net interest margin for Barclays UK was 3.22%, while the Barclays US Consumer Bank reported a net interest margin of 10.43%. The bank’s strategy includes offering attractive rates to retain and attract customers amid a competitive landscape.

Strong commitment to customer service and satisfaction

Barclays prioritizes customer service, reflected in its ongoing initiatives to enhance customer satisfaction. The bank achieved a customer satisfaction score of 85% in 2024, which is above the industry average. Additionally, Barclays has implemented a series of customer service training programs aimed at improving service quality and responsiveness.

Category	Metric	Value
Total Income (Barclays UK)	H124	£3,713 million
Total Income (Barclays Investment Bank)	H124	£6,347 million
Mobile App Downloads	2024	14 million+
Net Interest Margin (Barclays UK)	H124	3.22%
Net Interest Margin (Barclays US Consumer Bank)	H124	10.43%
Customer Satisfaction Score	2024	85%

Barclays PLC (BCS) - Business Model: Customer Relationships

Personalized banking experiences

Barclays PLC focuses on delivering personalized banking experiences through tailored financial solutions. In the first half of 2024, Barclays UK reported a total income of £3,713 million, which reflects a decrease of 5% compared to the previous year, driven primarily by lower deposit volumes and changes in customer preferences.

Average customer assets in Barclays UK were approximately £200.6 billion during this period, with a net interest margin of 3.15%.

Dedicated customer service teams

The bank maintains dedicated customer service teams across various segments. In H124, Barclays UK achieved a return on tangible equity (RoTE) of 20.4%, which is indicative of strong performance in customer service and support. The overall operating expenses for Barclays UK were reported at £2,108 million, reflecting a continued investment in customer service initiatives.

Loyalty programs and rewards

Barclays has implemented various loyalty programs to enhance customer retention. The total income from fee and commission income across the group was £5,429 million, which highlights the bank's efforts to incentivize customer engagement through rewards. The bank's loyalty programs are designed to provide value to customers, thereby increasing customer satisfaction and loyalty.

Active engagement through digital channels

Barclays has emphasized digital engagement, with a reported increase in digital transaction volumes. The bank's net interest income for the US Consumer Bank segment was £1,334 million in H124, reflecting a net interest margin of 10.78%, indicating successful digital strategies to attract and retain customers.

Barclays UK Corporate Bank also reported a total income of £877 million, emphasizing its digital transformation efforts.

Customer Relationship Strategy	Key Metrics	Performance Indicators
Personalized Banking Experiences	Total Income: £3,713 million	Average Customer Assets: £200.6 billion
Dedicated Customer Service Teams	RoTE: 20.4%	Operating Expenses: £2,108 million
Loyalty Programs and Rewards	Fee and Commission Income: £5,429 million	Customer Engagement Strategies: Multiple Loyalty Programs
Active Engagement through Digital Channels	US Consumer Bank Net Interest Income: £1,334 million	Net Interest Margin: 10.78%

Barclays PLC (BCS) - Business Model: Channels

Online and mobile banking platforms

Barclays has made significant investments in its online and mobile banking platforms, enhancing customer experience and accessibility. As of June 2024, the number of active mobile banking users reached approximately 6.6 million, reflecting a substantial increase in digital engagement.

In the first half of 2024, the bank reported an increase in digital transactions, with over 200 million transactions processed through mobile banking, representing a year-on-year growth of 15%.

Physical bank branches and ATMs

Barclays operates a network of 1,200 branches across the UK as of mid-2024, with a focus on enhancing customer service through physical locations. The bank also supports a robust ATM network, with approximately 5,000 ATMs available for customer use.

The total number of transactions conducted through physical branches has seen a decline of 10% over the past year, indicating a shift towards digital banking solutions. However, branch profitability remains stable, contributing to total income of £3.7 billion in H1 2024 from personal banking services.

Direct sales teams for corporate clients

Barclays employs specialized direct sales teams dedicated to corporate banking clients. These teams are essential in providing tailored financial solutions and maintaining strong client relationships. In the first half of 2024, the corporate banking segment generated £877 million in total income, down 6% from £935 million in the same period of the previous year.

The corporate banking division has approximately 1,500 relationship managers who focus on serving large corporations and SMEs, ensuring personalized service and responsiveness to client needs.

Partnerships with third-party financial service providers

Barclays actively collaborates with various third-party financial service providers to expand its service offerings. Notable partnerships include collaborations with fintech companies to enhance payment processing and digital wallet services. In 2024, the bank's partnerships contributed to a 7% increase in transaction volumes, amounting to £1.5 billion.

Through these partnerships, Barclays aims to leverage technology and innovation to improve customer experience and streamline financial services, aligning with its strategic goals for digital transformation.

Channel	Metrics	2024 Data
Online and Mobile Banking	Active Users	6.6 million
Online and Mobile Banking	Transactions	200 million
Physical Bank Branches	Branches	1,200
Physical Bank Branches	ATMs	5,000
Corporate Banking	Total Income	£877 million
Partnerships	Transaction Volumes	£1.5 billion

Barclays PLC (BCS) - Business Model: Customer Segments

Individual retail customers

Barclays serves a significant number of individual retail customers, offering a variety of financial products including current accounts, savings accounts, personal loans, and mortgages. As of June 2024, Barclays UK's total loans and advances to personal banking customers stood at £167.3 billion. The income from personal banking for H124 was £2.302 billion, which represented an 8% decrease compared to the previous year.

Small and medium-sized enterprises (SMEs)

Barclays provides tailored banking solutions for SMEs, focusing on business loans, credit facilities, and transactional banking services. For H124, the income from business banking was £954 million, reflecting a 1% increase year-on-year. The total loans and advances to SMEs were recorded at £21.2 billion.

Large corporations and institutional clients

Barclays caters to large corporations and institutional clients through its corporate banking division, offering services such as corporate loans, treasury management, and investment banking. For H124, the Barclays UK Corporate Bank generated £877 million in income, which was a 6% decrease compared to the previous year. The total income from this segment included a net interest income of £573 million.

High-net-worth individuals for wealth management

Barclays Private Bank and Wealth Management serves high-net-worth individuals, providing a range of wealth management solutions including investment advisory, estate planning, and private banking. As of June 2024, the total income from this segment was £632 million, showing a 13% increase year-on-year. Client assets in this segment reached £198.5 billion, driven by a 14% growth in invested assets.

Customer Segment	Total Loans (£bn)	Total Income (£m)	Year-on-Year Change (%)
Individual Retail Customers	167.3	2,302	-8%
Small and Medium-sized Enterprises (SMEs)	21.2	954	+1%
Large Corporations and Institutional Clients	64.0	877	-6%
High-net-worth Individuals	N/A	632	+13%

Barclays PLC (BCS) - Business Model: Cost Structure

Operational costs for branches and technology

Total operating expenses for Barclays PLC in the first half of 2024 were £8.2 billion, an increase of 1% from the same period in 2023. This includes a £120 million estimated impact from the Bank of England levy scheme.

Within these expenses, operational costs for branches and technology are significant. Total infrastructure costs amounted to £1.7 billion, including:

• Property and equipment: £857 million
• Depreciation and amortization: £843 million
• Impairment of property, equipment, and intangible assets: £4 million

Administration and general expenses, which include technology investments, totaled £1.3 billion.

Employee salaries and benefits

Employee compensation costs for Barclays PLC were £4.4 billion for the first half of 2024. This includes:

• Salaries: £2.5 billion
• Social security costs: £395 million
• Post-retirement benefits: £296 million
• Upfront bonus charge: £675 million
• Deferred bonus charge: £269 million

Overall, total staff costs for the period were approximately £4.9 billion.

Regulatory compliance costs

Regulatory compliance costs are also a critical component of Barclays' cost structure. The estimated impact of UK regulatory levies for the first half of 2024 was £120 million. The total operating expenses included litigation and conduct costs of £64 million.

Marketing and customer acquisition expenses

Marketing and customer acquisition expenses for Barclays PLC in the first half of 2024 were approximately £308 million. This reflects an ongoing investment in brand visibility and customer engagement, essential for maintaining market share in the competitive banking landscape.

Cost Category	Amount (£ million)
Total Operating Expenses	8,200
Infrastructure Costs	1,704
Employee Salaries	2,491
Social Security Costs	395
Post-Retirement Benefits	296
Regulatory Compliance Costs	120
Marketing Expenses	308

Barclays PLC (BCS) - Business Model: Revenue Streams

Net interest income from loans and deposits

In 2024, Barclays PLC is targeting a Group Net Interest Income (NII) excluding Investment Bank (IB) and Head Office of approximately £11.0 billion, up from a previous target of £10.7 billion. This increase is largely attributed to the higher interest rate environment and improving deposit dynamics.

Barclays UK NII is expected to be around £6.3 billion, an increase from £6.1 billion. The NII for the Group, including the Investment Bank, was reported at £5.4 billion in H124, with £2.7 billion specifically excluding IB and Head Office.

Fees from banking services and transactions

For the first half of 2024, Barclays generated £567 million from net fee, commission, and other income, representing a 12% decrease year-on-year. The breakdown of total income from various segments includes:

Segment	Total Income (£m)
Barclays UK	£3,713
Barclays UK Corporate Bank	£877
Barclays Private Bank and Wealth Management	£632
Barclays Investment Bank	£6,347
Barclays US Consumer Bank	£1,678
Head Office	£30
Total Income	£13,277

The corporate lending segment reported £129 million in income, while transaction banking brought in £790 million.

Investment banking fees and commissions

Barclays Investment Bank reported total income of £6.347 billion for the first half of 2024, reflecting a 1% increase compared to the previous year. Investment Banking income specifically rose by 7% to £2.215 billion, driven by higher fees in equity and debt capital markets. The detailed breakdown is as follows:

Type of Income	Amount (£m)
Net interest income	£465
Net trading income	£3,467
Net fee, commission and other income	£2,415
Total Investment Banking Income	£6,347

Investment banking fees from advisory services and underwriting increased due to heightened client activity.

Wealth management advisory fees

Barclays Private Bank and Wealth Management reported total income of £632 million for the first half of 2024, which is a 13% increase from the previous year. This segment's income is supported by a 41% rise in net fee, commission, and other income, totaling £270 million, reflecting the transfer of Wealth Management & Investments from Barclays UK.

The performance of this segment is also highlighted by the growth in client balances, which reached £198.5 billion, primarily driven by invested assets as a result of market movements.

Article updated on 8 Nov 2024

Resources:

1. Barclays PLC (BCS) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Barclays PLC (BCS)' financial performance, including balance sheets, income statements, and cash flow statements.
2. SEC Filings – View Barclays PLC (BCS)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.