/ Money

It could be a tight bank holiday for HSBC customers

HSBC

When’s the worst time to be hit by a bank IT glitch? On pay day? Before a bank holiday weekend? What about both. That’s what thousands of HSBC customers are facing today.

And when I say thousands of customers, I mean hundreds of thousands. Approximately 275,000 payments have been hit by a glitch in HSBC’s systems.

HSBC’s business customers are the ones who are affected, many of which are waiting for their wages to come into their bank account.

No pay this bank holiday

HSBC says it’s working to fix the problem, but @KSPARKGILL on Twitter isn’t happy about it:

She has even been sent a text by HSBC saying she’ll be charged for going into her overdraft. On that note, HSBC says it will make sure customers won’t lose out:

‘HSBC apologises for the inconvenience this has caused. We are taking immediate steps to ensure the payments reach beneficiaries as quickly as possible.

‘We will work with other banks to ensure that customers do not lose out as a result of today’s problems.’

This is one of many IT failures by the banks in recent years and I don’t think this latest one from HSBC will do much to reassure customers that improvements have been made. It’s essential for the regulators to take tough action to ensure banks properly maintain the payments system we all rely on.

HSBC bank glitch compensation

Jodie had these words for HSBC:

We expect HSBC to fully compensate anyone affected by this latest glitch. So if you’re an HSBC customer you can contact them at this number: 03457 404 404. Oh and please let us know if you’ve been affected.

Comments

And for those unable to draw cash or re-top any cards due to lack of pay you have my sympathy.

The advantages of having some cash cannot be under-rated. Which? did a survey I think last year which asked about people holding cash at home . Perhaps time to dust off the statistics : )

Having worked over 20 years in three banks I always hold some cash. I know you cannot trust them not to foul-up

Quite right Dieseltaylor, technology by its very nature is going to go wrong sometime and sods law says it will be at a critical moment for you; so a Plan B (and C…) is essential and not just as a backup for technology.

As someone who has experienced only this week glitches on both my laptop and tablet to my utter frustration and annoyance, was a gentle reminder to me how dependent we have now become on IT to function constantly. Given the enormous complexity of IT systems both the Banks and their customers have come to rely on to keep the cash flowing, I am inclined to agree with DT and `rarrar` a plan B in the form of a cash contingency is essential to avoid the inevitability of yet another Banking IT crisis. The `gremlins` responsible for this latest occurrence certainly picked the most inconvenient timing to work their fiendish pranks.

HSBC should be made to pay all affected customers £1000 and the bank directors should be fined £10,000 individually.

I think that is a bit harsh. I doubt if there is a single IT system on the planet that is 100% reliable. So long as customers who are out of pocket or seriously inconvenienced are recompensed and compensated there is no need for punitive pay-outs that will only increase the cost of banking. As this Conversation demonstrates, people are alert to the possibility of system failures and keep cash or deposits in other banks or building societies that they can access in an emergency. The important thing is that HSBC have made the failed payment transfers very quickly and have promised to rectify the system. The Regulator should exert some pressure too.

Interestingly, apart from a few sensationalist headlines, the media don’t seem to have gone overboard on this incident and there has not been a huge public outcry. Maybe we are getting used to this kind of thing occurring from time to time and have all developed or own work-arounds. HSBC has been one of the least problematic banks over recent years and it is unfortunate that they have experienced this breakdown in payment processing. I was disappointed that their website did not have any announcement or progress report on their front page and that when I did eventually find something it was a rather anodyne notice that, at the time I read it this afternoon, was out of date and had been overtaken by events. And I wish they wouldn’t describe a system malfunction as an ‘issue’; it’s pathetic euphemisms that undermine public confidence.

John Ward – What is reported widely in the media is not necessarily important and what is not widely reported may well be. The concept that the newspapers would have a serious pop at one of the larger newspaper advertisers such as HSBC should be thought about.

The Daily Telegraph is one example of considered journalism when it comes to Banks.

In the overall scheme of things 275,000 people not having their pay credited to accounts is not a huge disaster at all but believe me the knock-on ramifications can be very nasty and time-consuming for some of those customers. So it is not trivial and we should not be blase about allowing this to become “normal”.

It would be perhaps sensible if Banks actually outlined to people the need for cash. I met someone yesterday who with his wife attended an exhibition and the card reader for the venue was not working so they paid £14 entrance fee by cash, and later they wanted to buy a £20 book at the exhibition and the vendor also could not take cards and they no longer had sufficient cash.

Trip up to London to an exhibition with less than £34 ……… cards are wonderfully useful most of the time but perhaps carrying say £100 cash is not that silly given how inflation has eroded its value.

I agree with you, Diesel, that this is not a trivial matter, and the end-of-the-month-with-Bank-Holiday timing made it worse. I was responding to B. Martin’s suggestion that all 275,000 affected customers be paid £1,000 each which would cost the bank £275,000,000.

The Daily Telegraph had an amusing cartoon on its front page poking fun at HSBC by linking its computer problem with the Ashley Madison affair.

Carrying a useful amount of cash on any excursion makes a lot of sense and for a couple I think £100 would be the minimum I would consider. You never know what might crop up. Cheques can come in handy too. I always keep a couple in my wallet.

The update from HSBC posted by Patrick seems fair enough. Knowing that banks are dependent on computer systems it makes sense to have spare cash handy to cover for the occasional failure, as others have suggested.

If anyone is stuck without access to payment methods over the long weekend as a result of this, then they really need to organise their finances better. Everyone should have a credit card, at least for emergency situations such as this. Relying solely on one bank’s debit card is madness.

I happened to call in my local convenience store/PO yesterday to buy a few bits and bobs when I realised the cash in my purse was quite low and so expressed my need to visit the ATM almost next door. The very polite and friendly assistant informed me I could obtain my cash from their card reader, free without surcharge and the only limit was that determined by my debit card.

I should add he also used his friendly social and sales skills in persuading me to buy a larger bar of chocolate than I intended, but strange as it may seem the larger bar was cheaper than the smaller one, the only downside being the effect it will have on my waistline!.

That sounds extremely useful – was it the Post Office connexion that enabled the trader to provide the money Beryl? The amount of money in his till might also be a constraint on the amount he could pay out! – subject to the available balance in the current account, my debit card lets me withdraw up to £500 per day from an ATM or the Post Office.

The transaction took place in the Post Office section in the store which was a separate counter. I am not sure of the amount of cash available but the assistant did say the limit I could draw was dependent upon my debit card allowance.

” Everyone should have a credit card, at least for emergency situations such as this”

Such a simple solution. Apart for those under 18, and those too poor, or with an adverse credit card history.

I see the Luma Card is marketed to those with poor records, and to help them save and budget the interest rate is a mere 35.9%.

The Luma Card’s interest rate is 0% if the balance is paid off in full each month, giving up to 56 days’ interest-free credit. If a credit card is used only as a means of payment (e.g. for emergencies such as this) and not as a means of borrowing, then this is achievable, even by someone with poor credit history.

And to get back to the specific case mentioned by Diesel, people under 18, poor people, and people whose financial status does not qualify them for a credit card are – presumably – not making leisure journeys to London, attending an exhibition, and spontaneously buying books. If they wish to do that they need some money in their pockets, and it’s a lesson for the well-heeled as well because their cashless preference is not proof against system failure. I do think the exhibition organisers should have given them a pass-out to go to an ATM, however.

When I posted about the need for a Plan B, I was also thinking more generally i.e.
Spreading ones finances across more than 1 bank
Taking cash and 2 different bits of plastic when holidaying abroad
Making sure you aren’t totally dependant on your mobile for important contact details etc. when on holiday.
Maybe I’m a bit neurotic or just a belts + braces person but …….

I agree, particularly about travelling. I have two zero-fee credit cards for spending and cash withdrawals in currencies in which I don’t have a bank account. Halifax Clarity and Santander Zero (the latter being unavailable to new customers). When Santander erroneously blocked my card while in Kiev and Moscow, I switched to using Halifax. If I hadn’t had two suitable cards, I would have ended up paying 3% more on everything.

I also always carry a €100 note in my wallet in case of problems with cards. I used to carry a €500 note but I had to spend it once when I encountered such a problem, and then I decided that €100 was probably more sensible.