RBS Group suffers major systems failure

Posted in 'Banking' by Richard Catlin

22 June 2012

Thousands of customers of the Royal Bank of Scotland Group (RBS) were left frustrated – and that’s putting it lightly - yesterday, as an IT problem resulted in account balances effectively being frozen.

Personal and Business banking customers at RBS, (which include NatWest, Coutts and Ulster Bank) were hit by “technical issues” that caused incoming and outgoing payments to fail overnight – leaving many people without anticipated funds.

Although customers were still able to access cash from existing balances – the bank advised its customers to use only its own cash machines rather than any other - new account credits such as salary payments for individuals, and credit card receipts for businesses, were delayed and did not appear on online banking systems, a situation that continues as we write today on Friday morning.

Furious customers bombarded RBS’s various customer service channels, as well as taking to micro blogging platforms such as Twitter and the forum section of NatWest’s own website to vent their frustration..

The bank apologised unreservedly via the same medium, admitting that the situation was an “unacceptable inconvenience” and took the step of keeping over 1,000 branches across the UK open until 7pm to try and assist customers whilst they attempted to resolve the problem. .

Whether this is enough to placate people who – according to many of the angry posts – were left unable to pay for essentials such as food and heating, prescription medicines and vital journeys remains to be seen.

Our annual Banking and Credit Card Survey regularly reveal that bank customers have long memories when it comes to bearing a grudge. Last year’s survey saw 1 in 3 people say that they felt strongly enough to never recommend a particular lender to a friend. This actually represented a considerable improvement on 2010, when 45% of respondents had reason to resent a bank or credit card provider.

With many rival banks pursuing aggressive ‘switching’ campaigns, and new entrants such as M&S Money, Virgin and Tesco in the pipeline, this outage doesn’t come at welcome time for the part taxpayer owned RBS Group.

Most online banking sites have been hit by the odd brief outage – customers almost to expect it from time to time - but it’s the nature and length of this particular outage that has caused such outrage.

Even once everything is back up and running and account balances have been updated, it’s likely that the bank will be deluged with compensation claims from customers who were unable to make crucial payments on time - potentially harming their credit rating – or who incurred expense as a result..

One customer reportedly missed her flight home from holiday after being unable to pay her hotel bill on departure.

All in all, not a good day for the RBS group.

Richard Catlin is Marketing Manager at checkmyfile.com. He has a degree in Geography from the University of Glamorgan and can be contacted at richard@checkmyfile.com