RBS CEO Admits Bank Neglected Its Technology for ‘Decades’
Royal Bank of Scotland admitted to neglecting its technology after a system crash left more than 1 million bank customers unable to access funds on Cyber Monday.
From 6:30 p.m. to 9:30 p.m. on Monday, RBS’s customers of RBS, NatWest Ulster Bank and were unable to pay by debit at retailers, make online purchases or access online and mobile banking. Analysts accused the bank of running on outdated technology since it engaged in a series of acquisitions.
RBS CEO Ross McEwan said that RBS has failed to invest properly in its systems “for decades.” He apologized to RBS customers and announced plans to improve the bank’s systems in the new year. “We need to put our customers’ needs at the centre of all we do,” McEwan said. “It will take time, but we are investing heavily in building IT systems our customers can rely on. We know we have to do better.”
Unite, the union that represents RBS employees, blamed the problems on the more than 30,000 job cuts the bank has made since 2008. “Unite has grave concerns that staffing challenges are exacerbating the problems facing the bank,” said Dominic Hook, Unite national officer. “Serious questions must be asked as to why constant job cuts are being made when there are clearly serious issues which need addressing by management.”
The bank said that the problem has been fixed and promised to compensate anyone who was left out of pocket due to the crash. However, some customers were still complaining of problems on Tuesday.
The crash follows a similar incident in July 2012, which locked customers out of their accounts for several days. That crash cost the bank £175m to fix the problem and compensate customers.