Barclays has been told to put better systems and procedures in place after it failed, for a second time, to send annual reminders to payment protection insurance (PPI) customers.
The Competition & Markets Authority (CMA) issued Barclays with legal directions to prevent a similar incident from happening again.
In the period between October 2016 and October 2017, Barclays failed to provide a reminder to 2,265 Littlewoods' credit card PPI customers. It attributed the breach to a technical problem in transferring the customers to its computer system.
Following that breach, Barclays wrote to all affected customers, providing a reminder of their right to cancel the policy and the offer of a refund. From this communication, it has so far paid out almost £336,000 in refunds to customers.
Adam Land, the CMA’s senior director of remedies, business and financial analysis, said: "The annual reminder is an important measure so customers know they still have a PPI policy and how much it is costing them each year, as well as their right to cancel or switch.
"This is Barclays’ second breach of the PPI order. As a result, we are issuing legal directions which can be enforced by a court, to ensure they comply with the order.
"We now require assurances from Barclays they have now put adequate systems in place to prevent a similar breach from occurring again."
Following an investigation into PPI by the Competition Commission in 2011, one of the measures introduced in an order was that customers should receive an annual reminder from their provider setting out clearly how much they had paid in, and their right to cancel the policy.
The first time that Barclays breached the order was when it reported several substantive breaches to the CMA in 2015 for not providing annual reminders to almost 10,000 PPI customers.