TSB IT crisis: what happened and when will online services be fixed?

Scottish bank’s chief denies the company
failed to do enough planning and testing before the update was
rolled out

In Depth

What started as an upgrade to the bank’s online services on 20
April soon spiralled into a plethora of technical glitches.
Customers reported seeing other people’s bank details when logging
into the TSB online app. Others said they were prevented from
accessing the service altogether.

Two weeks on, the IT fiasco is still affecting thousands of
users. TSB chief Paul Pester has offered to forfeit
his £2m annual bonus, announcing that customers would receive
compensation for the “emotional distress” caused by the outage,
The Guardian reports. 

But with no end in sight, frustrated customers may soon find
themselves switching banks altogether.

How did it happen?

On 19 April, TSB announced through its Twitter feed
that it would be upgrading its online systems between 4pm on Friday
20 and 6pm on Sunday 22 April.

The company warned customers that some services, such as
online banking, making payments or transferring money, wouldn’t be
possible during the two-day upgrade period.

However, the changes that TSB implemented to its online services
turned out to be far greater than the simple software upgrade that
such services normally required. 

According to Wired, TSB was planning to shift the accounts
of its 5.4 million customers from an older IT system that was used
when the company was part of Lloyds bank. Although the two banks
separated in 2013, TSB was still using Lloyds’s system to manage
its customers.

Wired reports that TSB moved its online
operations to a cloned version of the Lloyds system between 20 and
22 April. The new system has been developed by the
Spanish banking group Banco Sabadell.

Shortly after the switchover took place, customers said they
were unable to access their online accounts. There were also
reports of a series of glitches and data leaks.

How were TSB customers affected?

On the evening of 22 April, complaints poured in on social
media. The majority of customers claimed they either
received an error message when logging into the service or were
denied access altogether. 

Some cases were more extreme. One customer claimed he was
£13,000 in credit when he logged in. When he used the service a few
hours later, the money appeared to have vanished from his
account.

One woman Tweeted that she had seen the account details of
another customer when she used TSB’s online banking service. She
described the glitch as “a serious DPA [data protection act]
breach.”

It now seems certain that several customers have faced
financial difficulties as a result of the crisis.  

TSB customer Colin Patterson told BBC
News that he was unsure whether he would be able to pay his
rent on time as he couldn’t access his online account. 

Meanwhile, photographer Paul Clark revealed to the
broadcaster that he had no way of knowing which of his clients had
paid him. 

“If we get to the middle of the week and it’s still not
resolved then my reputation and business could suffer as I work on
a quick turnaround. It’s a fiasco”, he said. 

What’s being done to resolve the issue?

The Independent says that company chief Paul
Pester and operating officer Miquel Montes were called before
parliament’s Treasury Committee on Wednesday. 

During the hearing, Pester told the committee, which was
headed by Nicky Morgan, that “the percentage of people logging in
successfully is 95%.”

“Of course, that means 5% are not logging in successfully
but that is often the case for any bank,” he added.

Morgan was unimpressed with the chief
executive’s explanation. She called Pester “a staggering example of
a chief executive who fails to recognise the scale of the problem
that is being faced.”

According to The Sunday Times, Pester apologised for the
fiasco but denied the bank had failed to do enough planning and
testing before the updates went live. 

The TSB CEO also refused to tell the committee when the problem
would be rectified, the newspaper reports. He justified this by
saying that giving a date could be “misleading to
customers”.