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RBS suffers another IT meltdown as payments go astray

17 June 2015  |  9795 views  |  5 RBS Bank branch sign

Royal Bank of Scotland is scrambling to fix an IT glitch that caused over 600,000 transactions and hundreds of thousands of pounds in payments to go missing.

The problem, which hit all RBS, NatWest, Coutt's and Ulster Bank customers, has affected salary, benefit and bill payments and other debit and credit transactions that should have been placed in customer accounts during the overnight batch run.

Customers took to Twitter to vent their frustration with the bank, which has been beset by technical problems over the past years.

RBS and Ulster Bank were hit with a £56 million fine by regulatory authorities last year over a computer malfunction in 2012 that locked customers out of accounts and knocked out payments processing systems.

At the time, RBS chief Ross McEwan admitted that the bank had failed to invest properly in its IT system for decades and promised to invest an extra 750 million pounds by the end of 2015 to enhance the security and resilience of its IT systems.

RBS says the cause of the current problems has been identified and it is working to restore missing payments to consumer accounts. However, it may take up to the end of the week to return all missing funds.

Comments: (5)

Chris Meggs
Chris Meggs - Chasm management limited - Ipswich | 17 June, 2015, 14:20 We have tried this before. Ready? After three: banks do Money, IT providers do IT.
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A Finextra member
A Finextra member | 17 June, 2015, 17:48 Yes - I remember sitting in a bank product launch a couple of years ago where the Bank Exec said "We're a technology powerhouse that happens to have a banking license...."
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Graham Seel
Graham Seel - BankTech Consulting - Concord | 18 June, 2015, 00:30

I remember as IT exec in a bank being constantly asked why it took so long and cost so much to implement payment systems. Here's the answer. 90+% of a payment system is exception code to address anything that might go wrong. And it is a bear to test. So it takes time and money. Or it breaks. Simple really.

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Graham Seel
Graham Seel - BankTech Consulting - Concord | 18 June, 2015, 00:32

And Chris, it is a little simplistic to say banks do money and IT does IT. Even if all technology is outsourced by the bank, they are accountable for requirements, testing, integration of operational processes, etc. And even IT providers don't always get it right :-) The reality is that payment systems are much harder than they seem like they ought to be, because they can NEVER be allowed to go wrong. I'm sure RBS would agree, now at least.

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Varadarajan Ca
Varadarajan Ca - FSS - Chennai | 18 June, 2015, 05:42

Sometimes banks negotiates cost for good IT infrastructure and testing of their products. A Reliable testing and good infrastructure is a real need in this fast growing technology.

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