Between January 2023 and February 2025, at least 158 banking IT failures disrupted millions of customers’ ability to access and use essential services, according to data revealed by the UK Treasury Committee.

The findings, which exclude recent high-profile outages affecting Barclays and other major banks, highlight a growing concern over the reliability of banking systems and their impact on customers, particularly during critical times such as payday.

The Treasury Committee, chaired by Dame Meg Hillier MP, has been investigating the causes and consequences of these outages, compelling major banks including Barclays, HSBC, Lloyds, Nationwide, Santander, NatWest, Danske Bank, Bank of Ireland, and Allied Irish Bank to provide detailed responses.

The committee’s inquiry revealed that common causes of IT failures include issues with third-party suppliers, disruptions from system changes, and internal software malfunctions.

Payday Chaos Causes Concern
One of the most significant incidents occurred at Barclays between January 31 and February 2, 2025, when a major IT outage left customers unable to access their accounts or make online payments.

The bank attributed the disruption to a “severe degradation” in the performance of its mainframe computer, a critical system used for bulk data processing. During the outage, 56% of online payments failed, leaving many customers distressed and unable to manage their finances.

Barclays confirmed to the Treasury Committee that it expects to pay between £5 million and £7.5 million in compensation to affected customers for the “inconvenience or distress” caused by the incident.

When factoring in compensation for other outages over the past two years, the bank’s total payouts could reach £12.5 million – with the £350,000 paid by the Bank of Ireland being the second-highest compensation figure during the same period.

The timing of these outages has exacerbated their impact.

Both the Barclays incident and a separate outage affecting Lloyds on February 28 occurred on payday, leaving many customers unable to access their wages, pay bills, or transfer funds.

For families living paycheck to paycheck, such disruptions can be devastating. Dame Meg Hillier emphasised this point, stating, “Losing access to banking services on payday can be a terrifying experience. Even when rectified relatively quickly, it can cause real panic.”

The Treasury Committee has pledged to request further information from banks involved in the most recent outages, including the Lloyds incident, which is not included in the aggregated data. The committee’s report underscores the need for banks to improve their response times and communication with customers during such crises.

Industry-Wide Challenges and Accountability
The data paints a troubling picture of the banking sector’s IT infrastructure, with 158 incidents recorded over two years – equivalent to more than one outage every week.

While the report acknowledges that even the most successful banks experience technical glitches, it stresses the importance of swift and transparent responses to minimise customer impact.

Dame Meg Hillier commended banks that have taken responsibility by compensating customers but urged others to follow suit. “The fact there has been enough outages to fill a whole month within the last two years shows customers’ frustrations are completely valid,” she said.

As the Treasury Committee continues its investigation, the focus will remain on holding banks accountable and ensuring that customers are adequately compensated for the distress caused by IT failures. The committee’s work has already prompted significant payouts, with Barclays leading the way in acknowledging its responsibility.

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However, the recurring nature of these outages suggests that more fundamental changes are needed to address the root causes of IT failures.

Whether through improved infrastructure, better oversight of third-party suppliers, or enhanced regulatory frameworks, the banking sector must prioritise reliability and customer trust.

For now, the data serves as a stark reminder of the vulnerabilities in the UK’s banking systems and the real-world consequences for millions of customers. As Dame Meg Hillier aptly put it, “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.”