RBS boss apologises for latest IT failure

Ross McEwan has apologised. Picture: Ian Rutherford

THE Royal Bank of Scotland has failed to invest in basic customer infrastructure “for decades”, its chief executive admitted yesterday, as he issued an abject apology for a crash in its IT system which left hundreds of thousands of customers unable to access their money.

In the latest embarrassing episode for the largely state-owned bank, Ross Mc-Ewan warned it would “take time” to fix the internal problems, as he conceded it was “unacceptable” that 750,000 customers of RBS, NatWest and Ulster Bank had been blocked from access to their own money.

The glitch, which hit customers for three hours after 6:30pm on Monday evening, was all the worse for taking place on the busiest online shopping day of the year, when thousands of people are buying gifts for Christmas.

As news spread on Twitter about the computer troubles, some RBS customers recounted having to leave goods at supermarket check-outs, or finding themselves unable to pay for petrol.

RBS Group customers were unable to use their cards after an IT glitch. Picture: PA

According to some customers, the “cyber-Monday” glitch was still causing problems yesterday, 24 hours after problems first arose. Although cash machines were working, some people found their balances were incorrect or payments had disappeared.

An RBS spokeswoman confirmed that more customers had called the bank yesterday to complain about continuing problems. However, she said the “vast majority” of customers were now experiencing a “good service”.

Responding to the criticism from customers yesterday, Mr McEwan, who became the bank’s chief executive on 1 October, said: “Last night’s systems failure was unacceptable. Yesterday was a busy shopping day and far too many of our customers were let down, unable to make purchases and withdraw cash.”

He added: “For decades, RBS failed to invest properly in its systems. We need to put our customers’ needs at the centre of all we do. It will take time, but we are investing heavily in building IT systems our customers can rely on. I’m sorry for the inconvenience we caused our customers. We know we have to do better.”

He went on: “I will be outlining plans in the new year for making RBS the bank that our customers and the UK need it to be. This will include an outline of where we intend to invest for the future.”

The latest problem to hit RBS is a further setback to attempts to restore its reputation following the 2008 financial crash. It comes as the bank seeks to fight off fresh allegations concerning its treatment of companies which banked with RBS.

A dossier compiled by businessman and government adviser Lawrence Tomlinson accused the bank of forcing viable firms into its Global Restructuring Group, pushed them into default and then seized their assets at rock bottom prices. The allegations are denied vigorously by RBS, but the bank has now launched its own inquiry.

The bank is also facing fresh criticism over the bonuses paid to staff, amid reports that as much as £500 million could be paid out to staff this year.

Monday’s computer crash evoked memories of a far larger software problem that affected millions of customer bank accounts last year, when an upgrade failed, preventing hundreds of thousands of transactions from taking place.

While the problem this week hit fewer customers, it could not have come at a worse time, locking accounts between 6:30pm and 9:30pm, as online shopping reached a peak.

Others said they may have incurred charges, because money that had been due to go into their accounts had not done so, leaving them overdrawn.

Yesterday, RBS officials said that those left out of pocket would be compensated. Any customer who had a fee incurred as a result of the failure would not have to pay, the bank said.

Susan Allen, RBS director of customer relations, said: “We sincerely regret the inconvenience that customers have had. There have been some fairly horrible stories about the inconvenience and distress caused for people out shopping yesterday evening.

“If anybody is out of pocket, then we have made a commitment that we will make sure that everybody is put back in the right position.”

RBS, which is still 80 per cent owned by the UK government, said it had improved its services since the problems in June and July last year, although it has had additional problems since.