British banks are being hit by more than one major IT or security failure that stops customers from making payments every day, a Which? Money investigation has found.
In the most comprehensive analysis carried out since banks started disclosing serious IT glitches last year, the consumer champion found there were 302 incidents that prevented customers from making payments in the last nine months of 2018.
The stark findings reveal that serious banking crashes are even more common than previously thought and highlight the need for the Government to step in and give a single regulator the statutory duty to protect access to cash and build a sustainable cash infrastructure for the UK – a vital backup while digital banking is so vulnerable to failure.
The research also comes as the independent access to cash review chaired by Natalie Ceeney is due to report imminently on consumer requirements for cash over the next five to 15 years. The interim report warned that failing to plan for a no-cash society “would do significant harm to the millions of people who would be left behind.”
Since April last year, the Financial Conduct Authority has required banks to inform them of any major operational or security incident which prevents customers from using payment services.
Which? found the average number of major breaches across each of the 30 banks and building societies in its analysis was one a month – with six of the major banks suffering at least one every two weeks.
Barclays reported most major incidents (41), at more than one every week in the last nine months of 2018. It was followed by Lloyds Bank (37), Halifax/Bank of Scotland (31), Natwest (26), RBS (21) and Ulster Bank (18).
TSB, where the botched introduction of a new IT system last year caused 1.9 million people to lose access to online banking services, reported 16 incidents.
Which?’s latest findings, along with incidents like last year’s Europe-wide Visa payments outage, suggest that Britain’s financial system has a long way to go before it will be resilient enough to support a no-cash society.
The consumer champion is concerned that more than 25 million people who consider access to cash a necessity risk being left vulnerable without a non-digital payment alternative as bank branches and cashpoints across the UK disappear at an alarming rate.
Previous Which? research has shown that ATMs vanished at a rate of 488 per month in the second half of last year, while more than 3,300 bank branches have closed since 2015.
Which? is calling for the Government to appoint a regulator with sole responsibility for the cash infrastructure to ensure consumers and businesses can continue to access the cash they rely on for as long as is necessary.
Jenny Ross, Which? Money Editor, said:
“Our research shows that these major banking glitches – which can cause huge stress and inconvenience to those affected – are even more common than we feared.
“This highlights why it is so important that a regulator is given responsibility to protect cash as a backup when technology fails and to ensure no-one is left behind as digital payments become more common.”
Notes to editors:
Full table of results available here
Since April 2017, UK banks have been required to report major operational or security incidents affecting their mobile, internet and telephone services to the FCA. This information is also published on the banks’ web pages. The most recent figures, published in February 2019, detail the number of incidents in the final three-quarters of 2018. Which? compiled those figures for this investigation.
Results for individual banks within a group should not be added together to produce a total for that group, as some single incidents affected more than one bank within a group.
The Access to Cash Review – chaired by Natalie Ceeney CBE – is funded by LINK, the operator of the UK’s largest cash machine network, but is independent from it. It is due to report imminently on consumer requirements for cash over the next five to 15 years. Its main objective is to ensure that there remains an effective and inclusive cash access service that meets the needs of all consumers. The interim report, published in December 2018, said: “In this first report, we ask the question ‘Is Britain ready to go cashless?’. Our research has shown that – as of today – the answer is a firm ‘no’. Cash is still an economic necessity for around 25 million people.”
Recent Which? Research found that cashpoints disappeared at a rate of 488 per month between June 2018 and December 2018, with more than 250 free-to-use machines also closing monthly.
Previously, Which? found that the UK has lost almost two thirds of its bank branches in the last 30 years, leaving a fifth of households more than three kilometres from their nearest branch.
More than 130,000 people have signed up to support Which?’s Freedom to pay. Our way campaign, which is calling for cash and other non-digital forms of payment to be protected as a payment option.