British Bank IT Failures Affecting Customer Credit Scores
A survey conducted by credit reference company, ClearScore, shows that banking IT meltdowns are having a negative impact on people’s credit scores.
IT failures at some of Britain’s biggest banks are more than just an inconvenience to consumers and businesses, they are having a negative impact on consumer credit ratings, according to research conducted by ClearScore.
More than two-thirds (67%) of people have found credit report errors following IT failures, which could bring down credit scores and affect people’s ability to qualify for a mortgage, loan or even a new mobile phone contract.
Most concerningly, many consumers may not even be aware that there are mistakes in their credit history. Around one-quarter of survey respondents who knew of an IT outage at their bank checked their reports afterwards. Nearly one-third failed to even check their credit report at all.
IT meltdowns at banks can mean that cash neither leaves nor enters a customers account as it should – which can cause some to miss bill payments. Unable to access their accounts, customers can struggle to move money around and even pay for day-to-day products and services.
Missed payments, ClearScore explained, can have even greater consequences. If, for example, late payment fees accrued from a missed payment has taken a customer over an agreed credit limit, breaching this could further impact their credit score.
In the past year, high-profile IT meltdowns have left thousands of banking customers across Britain locked out of their accounts. TSB’s botched system migration last year saw 1.9 million people lose access to online banking services for weeks at a time.
The TSB meltdown isn’t an isolated incident, however. According to the Financial Conduct Authority (FCA), 302 incident reports were filed by banks due to IT failures between the 1st April 2018 and the end of the year – this means that on average there is one incident per day affecting customers of Britain’s top banks and building societies.
Barclays recorded the most major incidents last year, with 41, following by Lloyds Bank, Halifax-Bank of Scotland and NatWest.
According to consumer group Which? consumers can use a number of methods and simple tips to ensure their credit history is up-to-date and accurate.
Consumers should ensure that all personal details, such as address information, is accurate while making sure that banks or lenders have supplied correct information about payments.
Additionally, people should make sure that all the credit applications recorded in their name are accurate.
“You should keep an eye open for potentially fraudulent activity, including fake credit applications, as scammers often take advantage of IT glitches,” the consumer group recommended. “If you spot a mistake, contact the credit reference agency to correct the record. The agency has 28 days from your request to inform you if it has removed the entry, amended it, or taken no action.”