Barclays and RBS on naughty step: Banks told to explain service meltdown to UK politicos The influential Treasury Committee has demanded that banking execs at RBS Group and Barclays must explain why customers were again unable to access online services at the tail end of last week. On Thursday, 20 September, Barclays' systems were offline for hours, while the Royal Bank of Scotland, NatWest and Ulster Bank went …
These include requests for technical details – which banks often prefer to keep close to their chest – on what caused the failure, and why any controls to mitigate against such failures had themselves failed.
So will the person interviewing be technical enough to ask the right questions and the interviewee to answer them?
Surely an oxymoron there?
"It simply isn't good enough to expose customers to IT failures, including delays in paying bills and an inability to access their own money."
Quite. It makes it so hard for HMRC to lift customers' money directly out of their bank accounts when the bank is offline.
Deliveroo had a failure last week and they compensated me by funding my account with £5 off my next order. To be honest they didn't need to do that, I didn't ask them to. I understand that things break, it's about the time taken to correct it thats important.
Alas I can't see Barclays doing the same with my next Direct Debit
In the case of banks, take it out of the bonus fund as a regulatory requirement. Performance will increase amazingly.
I doubt it. I've worked in banking for decades and there is nobody of senior director level and upwards with the least little clue about technology. There's a few layers of MD's, then several layers of D's, and literally none of them understand technology.
Its very hard to make the right decision when you don't know what you're doing, don't know who to ask, and don't want to live with what you personally perceive as a loss of face for asking. So they go to consultants, and they spend small firtunes doing what the consultant is selling this year, with little understanding that the same consultant (note, not contractor) will sell them an entirely different solution next year.
It'd be funny, if the consequences weren't so serious. Half or more of the senior staff in every bank I've worked at need to go, because its all just dead weight. Sorry, but it is. And that includes my own bank!
> their banking apps and websites cannot be relied upon
Well said! Hooray! As predicted, the Post-COBOL Apocalypse gathers steam!! Since COBOL is by far the most reliable and understandable computer language for handling money transactions, it's shunned by all hipster programmers. The cool, sorry, kewl new languages that keep popping up are so fun to play with .... looks to me that the brogrammers' attitude is, "Never trust a language over 3 [years old]." As more and more banks are pushed away from un-cool COBOL, the Apocalypse continues to build and build and build.
If you look at what new banks like Monzo are doing with their micro services and UK based IT staff you can see why the legacy banks are in so much trouble. They literally sacked everyone and thought they could outsource everything to India while being on a 1970's mainframe platform. Pure idiocy.
there are plenty of UK-based IT staff working for the big banks. There probably are fewer than there once were but there definitely are quite a few still.
There are, but we mostly work in what the bank would term "important functions", so, not retail banking.
Don't shoot the messenger, because as a retail bank customer myself, it pisses me off to, but the money isn't made in retail so its a cost to be managed.
So there are two problems here and both have the same route cause.
1. Banks suck at I.T. and try do anything they can to avoid modernising.
2. MP are not technical enough to ask the right questions or understand the answers.
The reason for this is that both groups are lead by old men who have not bothered to keep their skills up to do with the modern world.
Banks suck at I.T. and try do anything they can to avoid modernising.
But banks pretty-much *are* IT. They're a machine for storing, processing and moving numbers. When you distill it down, you should be able to completely automate a bank (except for when somebody wants to speak to staff). In a perfect world where nothing broke and everything followed the rules, the operational systems in a bank shouldn't need a human touch at all.
I know, I'm reducing it to an absurd level, but the point still stands that banks are IT with a layer of marketing.
Don't forget the casino bolted onto the side.
In Barclays case the bank is "the casino", with a retail function bolted onto the side. Like most other large banks, it has an investment bank where the real money is made, a corporate function, where a little money is made, and a retail bank that makes very little and was historically used to finance the first two, but post ringfencing is even less important that it used to be.
Obviously, its not a casino, it only looks that way to those that don't understand international finance or investment, but there ya have it.
@defiler
"When you distill it down, you should be able to completely automate a bank (except for when somebody wants to speak to staff). In a perfect world where nothing broke and everything followed the rules, the operational systems in a bank shouldn't need a human touch at all."
Congratulations :) You just reinvented Girobank, a fifty year old concept rolled out by the Labour government of the time (Wilson).
GiroBank was so successful as competition for the High Street Banks that it had eventually to be privatised and ultimately shut down before it wiped out the other high street banks (as they were then called). The high street banks have subsequently shut down almost all their high street operations anyway.
In many other parts of the world, the Girobank concept lives on. But the UK, and in particular in the City, it had to be eliminated. Isn't that marvellous.
@Doctor Syntax
""banks are IT with a layer of marketing"
Don't forget the casino bolted onto the side."
Congratulations :) By eliminating the casino on the side, you too just re-invented Girobank (see above).
The City's casino banking and the London property market are aspects of a world-class money laundering and financial crime centre, according to reliable sources (National Crime Agency, PPI claims outfits, Pension Protection Fund, etc). Without the casino facilities, Girobank threatened the career prospects of the banking industry dinosaurs,
Girobank. For the many, not the few. You know it makes cents.
We are having problems that are affecting some of our customers: The online system is completely down.
Our IT experts are analyzing the problem: The guy who knows this particular system is on holiday in Ibiza.
We expect to be back to normal in a few hours time: We haven't a clue whats going on so we made that bit up.
All affected customers will be compensated: As long as you fill out the form and take it to your local branch(LOL)
I understand why the treasury gets involved if data leaks, banks look dodgy, or they shutdown key infrastructure, but what business is it of theirs if the online banking app goes down for a few hours? The money was still there and accessible, just not through one particular channel.
I get why *we* are annoyed by it, but I don't see what the hell it has to do with the treasury...
Not in the case of Barclays last thursday. My wife had to make an urgent payment on a property transaction. Went to main branch - which of course is entirely automated, has, oh, maybe two staff doing equivalent job to those people who kick self-checkout machines in supermarkets.
All machines were down. NONE of Barclays branches had any access to any banking services that afternoon.
So if "online" is out, and "branch" is out, exactly how were Barclays still a consumer bank that day?
Gotta laugh and shiver in fear whenever there's a big political push towards 'cashless'. Cashless means inconvenience when things are down plus constant surveillance as a bonus. The benefits? Still not seeing them...
________________
The Swedes rebelling against a cashless society
http://www.bbc.co.uk/news/business-43645676
________________
Why cashless society is a dangerous idea
https://www.irishtimes.com/opinion/letters/why-cashless-society-is-a-dangerous-idea-1.2869212
________________
Visa card issue puts brakes on drive towards cashless society
https://www.irishtimes.com/business/personal-finance/visa-card-issue-puts-brakes-on-drive-towards-cashless-society-1.3519389
Gotta laugh and shiver in fear whenever there's a big political push towards 'cashless'. Cashless means inconvenience when things are down plus constant surveillance as a bonus. The benefits? Still not seeing them...
Can I start by going on record that going cashless is a terrible idea. There are so many downside risks its hard to even know where to begin. However, for the government, cashless looks like a good plan because:
A) It eliminates cash in hand work, or otherwise makes it easier to see where it is happening, while allowing crime detection opportunities - "What is little Johnny being paid 15 pounds for 23 times a day, while apparently job seeking?"
B) It allows negative interest rates to be applied thus motivating people to go out and spend in a recession - they can't tuck it under a matress
C) It saves a fortune in currency printing and distribution costs
D) Millennials, bless 'em, all seem to live near cashless lives. And as we're so often told, they're the future.
As I said, I think cashless is a terrible plan, but I can see why government would think otherwise.
One thing that 'cashless' does is to shift administrative burden from the shop to me. I have a whole extra lot of card transactions who's slips I need to keep and reconcile when the statement comes in.
I dare say that many millenials will want to know why reconcile ... I regard it foolish to NOT do so.
Consumer banking keeps going down. I wonder what would happen if the financial trading systems which move money by the billions and rely on microsecond timing were to fail for a similar amount of time?
Or could it possibly be that they can't be bothered to put the same resources into systems for mere consumers?
I wonder what would happen if the financial trading systems which move money by the billions and rely on microsecond timing were to fail for a similar amount of time?
Economic armageddon, literally. It'd be the end of days for the world economy.
I know everyone hates banks, but the flip side, is that everyone needs banks; they just often don't know why or how much.
I would love to have forwarded this to a board member because it's written so well, but in a professional capacity, I won't forward anything with TITSUP* in the title no matter how cutesy you try to make the definition at the bottom of the well-written article.
Come on, boys! You can do better.
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