How IT Failures In Banking Highlight the Need for Modernisation

Introduction

Recent findings by the Treasury Committee have revealed a concerning trend occuring the UK banking and finance sector.

Ove the past couple of years 9 major banks and building societies, have accumulated at least 803 hours or 33 days of technology outages.

These failures have caused mass disruption for millions of customers, with significant emotional and financial repercussions.

For organisations like Hopewiser – who specialise in Address Validation and Data Cleansing solutions and software, these revelations highlight the critical importance of reliable data and modern IT infrastructure.

The Impact of IT Failure for Customers

Barclays, HSBC, Lloyds, Nationwide, Santander, NatWest, Danske Bank, Band of Ireland and Allied Irish Bank reported 158 incidents between January of 2023 and February 2025.

Most notably, Barclays are potentially facing up to £12.5 million in compensation payments due to its IT outage which have left some of their customers in alarming situations.

While debit cards and withdrawing money from an ATM still worked, customers were unable to access their online and mobile banking during the outage.

Around 56% of its payments failed due to ‘severe degradation’ to its mainframe.

For families that live their lives paycheck to paycheck, these disruptions are not just an inconvenience, but life threatening.

The urgent need to address these IT failures has been emphasised in a statement by Dame Meg Hillier, chair of the Treasury Committee:

“The fact that there has been enough outages to fill a whole month within the last two years shows customers’ furstrations are completely valid.”

The outages impacted customers who were expecting salary payments and had tax returns to submit, but HMRC reassured customers no fines would be issued to those affected by the failure and nobody would be left out of pocket.

Hopewiser’s Role in Building Resilience

As banks and financial institutions are faced with increasing pressure to modernise their legacy systems and safeguard their customers, Hopewiser’s expertise in data management offers robust and reliable address data validation and cleansing solutions.

Inaccurate or flawed data systems can exacerbate IT failures by leading to incorrect analysis, flawed business decisions and data loss during integration and migration.  All of which can have a ripple effect across customer services. By ensuring the accuracy and reliability of databases, Hopewiser helps build robust infrastructures that minimise disruptions.

For instance, our Data Quality Services help you maximise business efficiency, understand your customers and align an organisation with GDPR’s principles.

In addition an Address Validation service will improve address data accuracy at the point of entry, which can enhance operational efficiency by reducing errors in customer transactions deliveries or communications – areas that often suffer during IT outages.

Accurate data is not just a technical detail, it is the very backbone of customer satisfaction and trust.

A Call for Modernisation

According to Patrick Burgess of BCS, the Chartered Institute for IT, these incidents “once again highlight that the traditional banking sector hasn’t kept pace with the investment needed to modernise its infrastructure.”

His sentiment aligns with Hopewiser’s overarching mission to empower businesses through digital transformation and data integrity.

As the fintech sector grapples with the challenges posed by legacy systems, Hopewiser provide scalable, innovative solutions which are designed to ensure that critical data systems remain reliable.

With a focus on resilience and accuracy, Hopewiser has positioned itself as a key player in the ongoing effort to modernise banking infrastructure and restore customer confidence.

Conclusion

The Treasury Committee’s findings remind us of the financial and personal cost of IT system failures.

For Hopewiser and other software and technology providers, this incident is an opportunity for us to champion efficiency, reliability and trust – qualities that are needed now more than ever before in today’s interconnected world.