6th Mar 2025 08:42
(Alliance News) - Barclays PLC could pay out up to GBP12.5 million in compensation to customers affected by technology outages over the last two years, a new letter to MPs has revealed.
There has been more than 33 days' worth of unplanned tech and system outages in the last two years for nine of the UK's biggest banks and building societies, according to new data published by the Treasury Committee.
The committee – a cross-party group formed of 11 members – asked the lenders' UK chief executives to reveal the scale of recent IT failures and estimates for how much customers might be paid in compensation.
It comes after an outage led to days of disruption for Barclays customers at the end of January, coinciding with payday for many workers and the deadline for self-assessment tax returns.
Barclays confirmed that, during that incident, more than half of attempts to make an online payment failed.
The bank estimated that it expects to pay out between GBP5 million and GBP7.5 million in compensation for the specific outage, adding to an estimated GBP5 million for other incidents between January 2023 and January 2025.
"We acknowledge that through no fault of their own, some of our customers and clients may have suffered loss or distress and inconvenience," UK Chief Executive Vim Maru wrote in the letter published by the Treasury Committee.
The outage occurred because of a software problem in a part of its UK mainframe operating system, and was not triggered by a cyber attack, Barclays told the committee.
Across the nine banks and building societies, there have been at least 158 IT failure incidents between January 2023 and February 2025, according to estimates they provided.
That figure does not include Barclays' recent outage, nor disruption to other banks' online services in more recent weeks.
Common reasons given for the incidents include problems with third-party suppliers, disruption caused when systems were changed, and internal software malfunctions.
MP Dame Meg Hillier, chair of the Treasury Committee, said: "The fact there has been enough outages to fill a whole month within the last two years shows customers' frustrations are completely valid.
"The reality is that this data shows even the most successful banks and building societies hit technical glitches.
"What's critical is they react swiftly and ensure customers are kept informed throughout."
She added: "I am particularly thankful to those who are compensating their customers well for the stress they endure and would encourage all to reflect on whether they are doing enough in that regard."
Barclays shares rose 1.4% to 307.70 pence each on Thursday morning in London.
By Anna Wise, PA Business Reporter
Press Association: Finance
source: PA
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