TSB’s outage last year, which left 1.9m customers locked out of their accounts and cost the bank £330m, demonstrates how catastrophic these IT issues can be to both businesses and consumers.
The problem for many banks revolves around their use of outdated legacy technology, which often buckles under the weight of modern-day demands.
Patching up the problem only delays the inevitable collapse, and many banks are now accepting the need to take bold action.
“Legacy software isn’t getting any better, and the gap between the old and the new is increasing, while customer expectations are also changing,” says Paul Taylor, founder of Thought Machine, a fintech firm which is building retail banking platforms in the cloud.
Launched in 2014, the startup has already partnered with Lloyds in an £11m investment deal, as well as Atom Bank. I’m also told that more announcements are expected this year.
“It’s a fresh start for the banks – freedom for the legacy,” Taylor says.
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