RBS chief Ross McEwan has admitted that the bank has failed to invest properly in its IT system for decades after customers were left unable to access their money or pay for goods on Cyber Monday.
The outage affected RBS, NatWest and Ulster Bank customers for around three hours on Monday evening, leaving them unable to withdraw money from ATMs, pay at the point-of-sale or access online and mobile services.
The problem hit on 'Cyber Monday', traditionally the most popular online shopping day of the year and at a time - early evening - when ATMs and shops are at their busiest.
The bank's CEO Ross McEwan has blamed a lack of IT investment over the years, saying: "For decades, RBS failed to invest properly in its systems. We need to put our customers' needs at the centre of all we do. It will take time, but we are investing heavily in building IT systems our customers can rely on."
Susan Allen, director, customer relations, RBS, told the BBC that the glitch was "unacceptable", promising that all customers will be reimbursed for any losses. Allen says that the cause of the meltdown is not yet known but a "detailed analytics" is underway, adding that the bank is "investing heavily in our systems" spending "about £2 million per annum in making sure our systems are improved".
Furious customers left stranded at cash machines and check-outs took to Twitter to vent their anger at the bank while some customers were still reporting problems in accessing online and mobile banking this morning, despite RBS's claims that services were back up and running.
Meanwhile, the bank is asking customers who have been left out of pocket to visit branches or call its contact centres to get their money back.
RBS - majority-owned by the taxpayer - has experienced several IT meltdowns over the last two years. Last summer customers were locked out of their accounts for several days, costing the bank more than £100 million in compensation and CEO Stephen Hester his bonus.
Since 2008 the bank has announced over 30,000 job losses in the UK and embarked on extensive restructuring, including offshoring of IT functions. Union bosses at Unite have asked the bank to demonstrate these latest problems are not caused by staff shortages or a lack of necessary investment in the infrastructure of the bank.
Dominic Hook, Unite national officer says: "IT problems will do nothing to reassure customers that RBS' commitment to quality customer service is backed up by proper investment in staff and systems. Unite has grave concerns that staffing challenges are exacerbating the problems facing the bank, challenges that could be further amplified when the CEO announces the outcomes of his Strategic Review in February."
Only last week RBS's managing director of digital banking, Chris Popple boasted that the bank has taken a proactive approach to dealing with disgruntled customers on social media but employees have been overwhelmed in the last few hours, although at least some people have seen the funny side: