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Treasury Committee: UK Banks Need To Invest In IT To Stop Failures

Michael Moore joined TechWeek Europe in January 2014 as a trainee before graduating to Reporter later that year. He covers a wide range of topics, including but not limited to mobile devices, wearable tech, the Internet of Things, and financial technology.

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Warning from head of parliament’s Treasury Committee comes after failures at three major high-street banks

Britain’s banks need to ramp up their investment in up-to-date IT systems to prevent future failures that leave customers high and dry, according to the head of a committee of MPs.

Andrew Tyrie, the chairman of Parliament’s Treasury Committee, has told British banks that they “can’t carry on like this” following several large-scale IT failures over recent months.

This includes HSBC’s recent online and mobile banking outage earlier this month, which left personal and business customers unable to access their accounts due to shortcomings in handling large demand, whilst RBS and Barclays have also suffered issues in recent months.

Suffering

Bank-of-England-Shutterstock-chrisdorney“Every few months we have yet another IT failure at a major bank,” Tyrie wrote, in a message published by Reuters. “These IT blunders and weaknesses are exposing millions of people to uncertainty, disruption and sometimes distress. Businesses suffer, too. We can’t carry on like this.”

Tyrie also suggested that Andrew Bailey, the deputy governor of Bank of England take up the leadership role for issues relating to failures suffered in the banking system.

Writing directly to Bailey, who also heads the bank’s supervisory section, in a letter published by the committee, Tyrie noted that, “Currently, no one group seems to be directly responsible for developing a full understanding of the risks carried. A group of this type should now be formed with the primary task of ensuring that the banks develop more robust resilience to protect banking and payment systems. The head of the PRA may be best suited for the leadership role.”

The UK had previously been thought of as one of the more technologically-friendly banking environments, with customers and businesses alike willing to embrace new services and systems.

The country recently granted a licence to its second digital-only bank, with Tandem joining Atom Bank, which received its licence back in June, to offer customers a wider range of online services.

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