Banking outages happen because banks ‘can’t keep up with tech’

3 February 2025, 14:04

a woman using a laptop as she holds a bank card
a woman using a laptop as she holds a bank card. Picture: PA

Industry expert Chris Skinner said the vast IT infrastructure behind banking was a ‘challenge’ to manage and was likely causing outages.

Online banking outages are happening because banks are finding it “too hard to keep up” with fast-moving technology, an industry expert has said.

On Monday, Lloyds Bank and Halifax were hit by an issue that left customers unable to receive payments and came in the wake of a major Barclays outage that began on Friday and continued into the weekend, leaving many unable to access funds on payday.

People walking past a branch of Lloyds Bank
Lloyds Bank confirmed its systems were back up and running after an outage on Monday morning (Stefan Rousseau/PA)

Lloyds said its systems had returned to normal by late morning, but the incidents have been the latest in a growing number of online banking outages in recent months.

Financial technology expert Chris Skinner said the vast array of technology systems needed to operate in the modern banking world meant banks have “such a smorgasbord of things they have to work with” that the “competence of keeping up with these changes is really challenging every bank”.

He told the PA news agency that clusters of incidents were also more likely because of the shared financial IT infrastructure and close links between institutions.

Mr Skinner said it meant that situations similar to the CrowdStrike outage in 2024 – where an issue within one infrastructure firm caused a global IT outage – were now more likely in the banking sector.

“If you look at what happened in the US last year (with CrowdStrike), it was like a house of cards,” he said.

“There was a linked organisation that failed, and then other organisations failed on the back end of their failure, and I think that’s where we are today – we have this house of cards where you’ve got an awful lot of institutions working co-operatively with each other, but if one messes up the system, then the whole system fails.”

Crowdstrike homepage
The CrowdStrike outage in 2024 caused global systems to fall ‘like a house of cards’ (Yui Mok/PA)

Mr Skinner, who also runs the industry blog The Finanser, added that the recent flurry of outages, a number of which have occurred on Fridays and close to paydays, was likely because firms plan software updates for the weekends as it tends to be quieter, but said cybercriminal activity could also be playing a role.

“I think there’s a couple of things in the background – one is that the banks have to regularly update their systems to keep up with infrastructure providers, and when they do that, they normally would target a Friday evening, on the basis that the weekend is the quietest time for transaction and processing,” he said.

“So a Friday is probably the most likely day to have an instance where a system update causes a problem and then they have to reboot the system to get it back to where it was before the update to fix it.

“And I think the second thing is the largest banks in the world are the ones targeted the most by the criminal community in the dark web and elsewhere.

“That doesn’t necessarily happen on a payday or a Friday, but having said that, if you think about the large amount of money moving on a payday, then that’s the greatest opportunity to hijack the system.”

I think the world is spinning so fast with technology that the challenge we have is no one's keeping up, particularly regulators and lawmakers

Financial technology expert Chris Skinner

Mr Skinner told PA that regulators and lawmakers were also struggling to keep up with rapidly evolving technology.

“I think the world is spinning so fast with technology that the challenge we have is no one’s keeping up, particularly regulators and lawmakers,” he told PA.

“And so the regulators and lawmakers need to have people who do better due diligence.

“I think there’s an issue here with reliability, service and resilience, and that’s the accountability of the people who are organising the structures, both from within the business, and those who look over the business in terms of the regulators.

“At the moment, I think both are probably finding it too hard to keep up.”

By Press Association

More Technology News

See more More Technology News

People ride an upward escalator next to the Dior store at the Icon Siam shopping mall on June 12, 2024 in Bangkok, Thailand.

Luxury fashion giant Dior latest high-profile retailer to be hit by cyber attack as customer data accessed

A plane spotter with binoculars from behind watching a British Airways plane landing

‘Flying taxis’ could appear in UK skies as early as 2028, minister says

Apple App Store

Take on Apple and Google to boost UK economy, think tank says

A survey of more than 1,000 employers found that around one in eight thought AI would give them a competitive edge and would lead to fewer staff.

One in three employers believe AI will boost productivity, research finds

Hands on a laptop showing an AI search

One in three employers believe AI will boost productivity, research finds

Music creators and politicians take part in a protest calling on the Government to ditch plans to allow AI tech firms to steal their work without payment or permission opposite the Houses of Parliament in London.

Creatives face a 'kind-of apocalyptic moment’ over AI concerns, minister says

Ngamba Island Chimpanzee Sanctuary on Lake Victoria, Uganda

Chimps use medicinal plants to treat each other's wounds and practice 'self-care' as scientists hail fascinating discovery

Close up of a person's hands on the laptop keyboard

Ofcom investigating pornography site over alleged Online Safety Act breaches

The Monzo app on a smartphone

Monzo customers can cancel bank transfers if they quickly spot an error

Co-op sign

Co-op to re-stock empty shelves as it recovers from major hack

The study said that it was often too easy for adult strangers to pick out girls online and send them unsolicited messages.

Social media platforms are failing to protect women and girls from harm, new research reveals

Peter Kyle leaves 10 Downing Street, London

Government-built AI tool used to cut admin work for human staff

In its last reported annual headcount in June 2024, Microsoft employed 228,000 full-time workers

Microsoft axes 6,000 jobs despite strong profits in recent quarters

Airbnb logo

Airbnb unveils revamp as it expands ‘beyond stays’ to challenge hotel sector

A car key on top of a Certificate of Motor Insurance and Policy Schedule

Drivers losing thousands to ghost broker scams – the red flags to watch out for

Marks and Spencer cyber attack

M&S customers urged to ‘stay vigilant’ for fraud after data breach confirmed