Why banking apps and websites stop working and what to do if yours suffers a computer disaster?

HSBC, Nationwide, Barclays and Virgin Money customers have been affected by payment issues today (Friday 28 June 2024).

Our ongoing guide below tells you what to do if your bank suffers an IT crisis…

It’s always a pain to not be able to access your money because your bank’s app or website is inexplicably down.

You refresh the app or website again and again, but you get the same frustrating message: “Sorry, some kind of error has occurred.”

Customers were faced with this last month when NatWest became the latest major bank to suffer an outage.

This meant that thousands of people were unable to log into their accounts or access their money for up to three hours.

This is Money looks at why banks fail and what to do if you can’t access your money.

Why do banks fail?

The first thing you should do if you think your bank’s services may be down is to verify that it is a problem other customers are having and not just a problem with your own connection.

Most banks have an online status service page, so you can check if a widespread problem has been reported.

> See our roundup of the top five checking accounts

Andrew Hagger, founder of MoneyComms, says: ‘IT outages can come in many forms. It may be isolated, so it could simply be an app, online banking, or ATM network that is unavailable.

‘On the other hand, there could be a complete outage that puts everything out of service, but that is less likely.

‘All financial providers should have a duplicate of all systems they may switch to, as part of a broader IT disaster recovery plan, to minimise customer service disruptions.’

Problems with banking apps and websites can also be caused by software updates, upgrades, or hardware component failures.

Hagger adds: ‘However, all software updates must go through a strictly controlled change management system and should only be made live once they have been tested on non-live or development versions of the website.

‘It could even be a database space availability issue, however these sorts of things need to be monitored closely as part of the daily IT service management maintenance controls.’

‘Sometimes problems are caused by inefficient legacy IT systems, particularly where banks have merged and had different hardware and operating systems that are not as fluid as they could be.

‘Cyber ​​attacks have the potential to paralyse services, however the security of banks’ IT systems is of paramount importance and is taken very seriously by individual banks and regulators.’

Here are our top tips on what to do if your bank goes bust.

1. Have a second bank account

One of the main things you should do is have a second bank account with access to online banking. It is not necessary to maintain a great balance.

Andrew Hagger says: “If you have a separate account and a debit card, you will be able to make payments. Additionally, if you have a separate online savings account, you should be able to transfer funds to your second account while your main account is down.”

2. Keep a cash reserve

When your bank fails, simple things we take for granted become a source of worry.

Keeping a cash reserve that you can use in an emergency is a good way to tide you over in case your banking app stops working.

Obviously you won’t be able to pay bills in cash, but it could help you out of a bind if you need to go to the shops or pay for parking, for example.

3. Complain to your bank

If you are not happy with the service you receive from your bank due to outages, you can complain.

You can file a complaint in person, by phone, or in writing by letter or email, depending on how you do your banking.

Keep a record of the date you contacted them to file the complaint.

This may be important if you want to take the complaint further, for example by going to the Financial Ombudsman Service, which requires that you give your bank eight weeks to respond.

4. Keep track of service outage time

Certain times of the month may be more prone to bank outages, such as at the end of the month when many people receive their payments and try to access their banking services.

Some banks may also schedule maintenance on their banking apps during the early hours of the weekend and should notify you of this in advance in the app.

If your bank goes down, write down the time the outage occurred in case it comes in handy.

5. Change checking account

If you are bothered by frequent outages, you can switch your checking accounts to one at a bank that has not had a recent crisis.

Some banks will even pay you to switch. Six banks are also currently offering cash bonuses of up to £200 for switching current accounts.

First Direct, Lloyds and Santander are offering £175 to customers who switch, TSB pays £100 cash up front and £10 cashback a month for six months to those who switch, while Nationwide pays £200 to existing members who have a mortgage or savings account but don’t have a current account.