Lloyds Bank discloses data breach caused by software error impacting 447,000 customers

Lloyds Banking Group has confirmed that an IT malfunction earlier this month exposed the personal and financial information of nearly 447,936 customers across Lloyds, Halifax and Bank of Scotland. The error, introduced during an overnight software update on 12 March, caused some users to view other customers’ transactions, including account details, national insurance numbers and payment references. According to the company, 114,182 individuals clicked on incorrect data that appeared in their banking apps. Although the issue was resolved promptly, the glitch led to widespread alarm among customers who initially feared hacking or fraud. Lloyds has since issued goodwill payments totalling £139,000 to around 3,625 people — an average of £38.34 each — as compensation for distress or inconvenience caused. Jasjyot Singh, Lloyds’ consumer relations head, apologised in a letter to the Treasury Select Committee and stated that the bank is working closely with the Financial Conduct Authority and the Information Commissioner’s Office. Committee chair Dame Meg Hillier commented that the incident underscores the trade-off between digital convenience and the risk of unforeseen technological errors. Industry experts, including Krista Griggs of GFT and analyst Paolo Pescatore, warned that the scale of the issue highlights the need for stronger systemic resilience and a design approach prioritising customer data protection in digital banking platforms.