UK Banks Report Widespread IT Disruptions on February Pay Day

On 28 February, widespread banking disruptions affected approximately 1.2 million customers across several major UK banks during a peak financial period—payday. According to letters sent by Lloyds, TSB, Nationwide, and HSBC to the Treasury Committee, customers experienced issues accessing their accounts and online services. Lloyds Banking Group reported the largest impact, with around 700,000 users facing difficulties logging in on the first attempt. HSBC disclosed that its average customer service wait time ballooned to two hours, far above its usual five-minute standard. Despite these issues, the banks insisted there was no uptick in fraud, and they have begun compensating affected customers, with Nationwide paying the largest sum—£84,341. Overall, more than £114,000 has been distributed in compensation. Experts attribute these outages to outdated IT systems, noting that such problems are becoming more frequent. In fact, over the past two years, UK banks and building societies have recorded more than 800 hours of service outages. Financial IT experts argue that these incidents are foreseeable and preventable with proper system modernization. The Treasury Committee is continuing its investigation into the systemic weaknesses in banking IT infrastructure, underscoring the importance of technological upgrades to restore and maintain customer trust.