UK Finance: Industry works with regulators to stay prepared for major IT disruptions

Michael Lloyd

November 27, 2019


The industry conducts sector-wide exercises with regulators to ensure it is prepared to respond effectively to any major IT disruptions or events, UK Finance has revealed.

An analysis of FCA data by Which? has found banks suffer five IT failures every week, shutting millions of customers out of accounts and unable to make payments.

Stephen Jones, chief executive at UK Finance, said that digital innovation is transforming the industry and the trade association is working with regulators to stay prepared for issues.

He said: “Operational resilience is crucial in a modern financial system and the industry continues to invest billions to ensure systems – human and digital – are robust and secure.

“When incidents do occur, firms work around the clock to minimise disruption and get services back up and running as quickly as possible.

“Digital innovation is transforming the way money is managed with 24/7 access to payment systems, increasing the range of day to day banking options and providing better back-up for customers if a service is temporarily disrupted.

“The industry conducts sector-wide exercises with regulators to ensure it is prepared to respond effectively to any major disruptions or events as part of its continued commitment to maintaining the resilience of the financial system.

“UK Finance continues to engage with government over how coordination between regulatory authorities could be improved, seeking to avoid overlapped or rushed mandatory change programmes that impact firms’ ability to protect their customers.”

In the past year, the main UK banks suffered 265 IT shutdowns that have prevented customers making payments.

RBS and Santander customers endured the most IT glitches last year with both banks suffering 18 failures.

This is followed by Barclays (17), Tesco Bank (16) and First Direct (15).

Starling Bank and M&S Bank both went a whole year without a single glitch.

The FCA figures come after another turbulent week for TSB, which saw the bank faced with another systems issue that prevented customers from receiving payments.

The bank had made public the report into last year’s IT meltdown that dragged on for months and left 1.9 million customers shut out of their accounts.

However, TSB suffered fewer glitches than many of its rivals, with only six in the past year.

Gareth Shaw, head of money, Which?, added: “These findings show the industry is still failing to get to grips with alarmingly frequent banking glitches, which can cause real stress and frustration for millions of people left locked out of their account and struggling to make payments.

“In our nationwide survey, consumers have made it clear that cash is a vital back-up when digital systems fail – so it’s clear the next government should urgently introduce legislation to protect cash for as long as it is needed.”

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