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Rbs It Failure

In: Business and Management

Submitted By abbylweaver
Words 1935
Pages 8
BMIS 2409

Alex DeFazio
Jenna Laughlin
Abby Weaver
Melanie Yellowday

RBS IT Failure Write-up

On June 19, 2012 the Royal Bank of Scotland Group (RBS) experienced a huge, public information technology failure. While the bank has publicly attributed the problem to an error during the update of their payment processing system software, it is clear from past IT mishaps that many other failures must have first occurred. The investigation by the Financial Conduct Authority (FCA), a United Kingdom regulatory body, is ongoing and a penalty to RBS is expected. The glitch affected millions of customers and left some unable to access money within their accounts and delayed transfers to other banks. The huge backlog of account transactions took several weeks to resolve, and conflicting sources of blame were given by the company during this time. In March 2013, an additional incident occurred resulting in problems with online and phone banking, cash withdrawals, and debit card payments. A spokesperson had stated, “This problem was caused by a hardware fault and was not related to the issues we experienced last summer. It was much easier to fix, though clearly an unacceptable failure.” However, it is hard to believe that these problems were not the result of a systematic lack of internal testing and verification and conscience chain of command. As in the Hafford case, where a major IT decision was made without proper vetting, even minor upgrades in the banking industry are critical. Moments of interruption in service can result in customer dissatisfaction, required customer compensation, and regulatory fines. The main characteristic of an IT project failure within the banking industry is any unplanned interruption in service to their customers. For RBS, the above two IT failures caused trouble to millions of customers. This is also the case for Hafford, where their…...

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