The collapse of Barclays’ payments
system this weekend could have been caused by something as simple
as “a cleaner pulling out the wrong plug”, according to an industry
expert.

Customers were unable to make card
transactions, use ATMs or access online
banking and retailers could not accept
payments from 2pm on Saturday for around 20
minutes.

The IT shutdown is embarassing for
Barclays because it positions itself as an innovator in
card payments. It has spent millions implementing and
advertising its new contactless card technology and
Barclaycard Freedom, its loyalty programme, which are designed
to make shopping more convenient for consumers and retailers.

Barclays spokesman Alan White told Cards
International
the bank will launch an internal investigation
into how it can avoid a repeat collapse. He claimed the bank
already knew what had caused the problem, but declined to say what
it was.

“I think that our customers can be reassured
that we were able to restore the problem swiftly,” said Alan White,
a spokesman for Barclays.

“Innovations such as m-banking or internet security would not
have been affected by this temporary technical glitch. This
situation would not discredit any of the innovative services that
we provide to our customers.”

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By GlobalData

An industry expert, who did not want to be
named, said there could have been a number of reasons for the
breakdown. The most likely is that there was a problem with
Barclays Bank’s in-house core banking system, because all of the
bank’s platforms – online, credit and debit cards and ATMs – were
affected.

If the problem came from its credit cards division, Barclaycard,
the main culprit is likely to be its legacy Triumph system.
External networks like Visa, MasterCard or the Link ATM network are
unlikely to be at fault because other banks in the UK were not
affected.

The source said the problem could even have been caused by
something as simple as “a cleaner pulling out the wrong plug”.

DBS, a Singapore-based Bank, recently suffered
from a similar collapse of its banking systems. Its online banking,
ATMs, cards and point of sale platforms broke down, leaving
customers unable to make transactions between 6.30am and 10am on
Monday 5 July.

DBS’s domestic regulator, the Monetary Authority of Singapore,
criticised the bank for “inadequate management” and the lack of “a robust technology risk
management framework” 
after DBS presented the
findings of an internal review.

Asked if it would investigate Barclays, the Financial
Services Authority said it would not comment on individual cases. A
separate industry insider said the short length of the outage, at
20 minutes, was unlikely to attract the attention of the regulator.
He added the bank could have faced bigger problems if the shutdown
had happened on a week day, when other transactions like direct
debit payments would have been affected.