Member Article

Banks need to address creaking IT infrastructure

When I look at the problems RBS are having just now, I feel they are missing a trick. The legacy systems which are now outdated were responsible for 600,000 customer payments and direct debits going missing on Tuesday. It never feels like long time since the last IT banking meltdown which had an impact on customers and caused a great deal of stress and inconvenience.

Tarnished banking brands have no hope of rebuilding trust with customers without making an investment in improving their infrastructure. Investing in IT and great systems mean you are investing in people and the service. There is no excuse nowadays to have bad service and systems that don’t support your clients at the highest level.

Banks in particular have to be held to account. They offer a critical facility and they make a lot of money from doing it, so it’s not acceptable that they don’t look to keep their systems in check and that people’s transactions are affected. When you see people not able to buy food or pay their rent because of the failure to update IT, it makes me angry.

It is positive that regulators will be taking a look into the IT systems at several banks as these processes are too important in people’s lives to leave at the mercy of outdated infrastructures. The major banks are going to want to adopt new payment innovations in coming years. They would be as well to examine whether their systems are fit for purpose and modernise them now, before there are any more damaging failures like this.

In addition to the failure of IT, in this case there is also the failure of communications, which compounds the reputational damage. At first RBS were tweeting about ‘missing’ payments, which caused a panic, and then a spokesperson had to be wheeled out to say that the payments were merely ‘delayed’.

Semantics aside, major banks need to take a more pro-active approach to security and resilience in their IT systems.

This was posted in Bdaily's Members' News section by Lawrence Jones .