You would think that banks were about to collapse as a result of computer problems some days when you flick through your Twitter feed, but the online noise is often misleading and makes problems appear bigger than they are.
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But highly public outages will cause banks reputational damage and banks will have to use artificial intelligence to automate fixes so as few people as possible are affected. Otherwise they risk their names being associated within problems.
Last Week it was the turn of NatWest as customers vented their anger on Twitter when they were unable to access online banking services. Social media blows it all out of proportion. You only need five angry customers on Twitter experiencing problems and you have a story.
Of course there are sometimes serious problems like the troubles the Royal Bank of Scotland, which owns NatWest, had a few years ago when its CA-7 batch process scheduler froze in the summer of 2012. Customers of RBS, NatWest and Ulster Bank could not access funds for a week or more as account balances had to be manually updated. Such was the magnitude of the problem RBS was fined ₤56m by regulators for the failure.
While this was an exceptional incident much smaller problems often hit the headlines. In the past the public wouldn’t notice when a bank had smaller computer glitches because it was all in the background and customers would not understand it.
But times have changed and digital bankers are suspicious if their banking app takes a few seconds extra to download these days. I know I am.
One IT professional in the banking sector told me there have always been computer glitches but in the past customers would never know about them. “I think the main change in recent years is the banks cannot hide or deny problems like they used to. Social media now allows customers to shine a light on problems instantly and widely which prevents the banks from denying issues or playing them down,” he said. “So social media is forcing them to be a bit more honest. I’m not sure if there is an increase in glitches, I suspect there is just an increase in them being made public via social media. In the past, I’m sure banks would say ‘oh no, you are the only one with this problem’ but now they cannot do that if people light up the social media sites.”
So social media is a positive force in forcing banks to improve. A virtual kick up the backside if you like.
Following the NatWest problems last week a bank spokesperson said: “We’re aware that it took some customers a little longer than usual to access Online Banking today. This has been resolved and Online Banking is now working as normal. We apologise for the inconvenience caused. Customers were still able to access their accounts or complete a transaction using our Mobile Banking, Telephone Banking, or by visiting one of our branches or ATMs”. It all seems forgotten a week later as it is just another banking glitch. But when does a small glitch become a problem for banks?
The number of people using digital banking channels is only going to go up as banks move services to digital channels. According to the recent research from Visa found that mobile banking apps are used by 69% of young people to manage their finances in the UK. Just over half (53%) of those between the ages of 18 and 34, known as millennials, are using these mobile apps regularly, according to research of 2,000 people in the UK by Visa.
Banks are putting their money behind this as a way to retain customers and cut costs. But when the number of digital banking users gets close to 100% they cannot afford the number of small glitches they are experiencing.
This week the European banking Authority published its annual report on the main risks facing banks in Europe. Unsurprisingly fintech and a growing reliance on digital platforms are now seen as a current concern with increased the likelihood of cyber attacks and IT failures.
So banks will need to focus on reducing IT failures, no matter how small, and fixing them automatically. Artificial intelligence is the way the banks could do it. Fixes will have to be automated through AI software. Customers will be able to explain a problem to a software robot using speech or text, which will than automate the fix by translating the problem into a language understood by an autonomic platform. This will fix the problem quickly and ensure if it happens again the problem is fixed automatically. Although they wouldn’t see it you don’t want your customer to have to instigate a traditional ITSM like ticket every time they have a problem. This is the way forward for banks that have been cutting their IT staff and increasing automation.
AI could ensure that problems are fixed so quickly that only one person will notice and through machine learning should not happen again. Well that’s the theory anyway.