B2B Payments

TSB ‘On Its Knees,’ Hires IBM To Address Meltdown

TSB continues to face the fallout from a meltdown of online banking services to small businesses (SMBs) and consumers after a botched IT system upgrade. The U.K. challenger bank has now called in IBM to help fix the problem.

TSB Head Paul Pester said the financial institution is “on our knees,” according to BBC reports on Thursday (April 26), but vowed to “get back up and come back fighting” once the situation was resolved. According to Pester, experts from IBM have been called in and will report “directly” to the chief, adding that the bank is still not entirely sure how the glitch happened.

“We have two data centers, miles of fiberoptic cable and several layers of software,” he told reporters. “Somewhere along that architecture are issues causing capacity constraints. We have a team of experts that will get to the bottom of this.”

He also vowed that customers will not pay any overdraft fees or charges this month.

Reports said about half of the bank’s small business and consumer customers have been completely locked out of their accounts since Friday, when the institution began migrating data from a Lloyds-owned IT system to one built by the bank’s new owner, Spain’s Sabadell.

Separate reports in The Guardian said the shutdown has led small businesses to warn of late VAT payments to HM Revenue & Customs (HMRC).

“HMRC will take the circumstances of TSB customers into account if asked to do so,” a spokesperson for HMRC said.

The publication also reported that compensation is starting to trickle out of the bank for impacted customers. Citing MoneySavingExpert.com, The Guardian said TSB paid one customer £40, covering interest and inconvenience after the customer was locked out of her account and could not pay a credit card bill. Reports noted that if £40 is the average payout to its 1.9 million online and mobile customers, the bank will pay a total of £47.5 million (about $66 million), though there is no indication of exactly how much TSB will compensate its customers, or how it plans to calculate how much to issue.

——————————–

Latest Insights: 

With an estimated 64 million connected cars on the road by year’s end, QSRs are scrambling to win consumer drive-time dollars via in-dash ordering capabilities, while automakers like Tesla are developing new retail-centric charging stations. The PYMNTS Commerce Connected Playbook explores how the connected car is putting $230 billion worth of connected car spend into overdrive.

TRENDING RIGHT NOW

To Top