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July 9, 2018updated 10 Jul 2018 3:09pm

UK Online Banking Infrastructure in Mystery Outage

Outage comes amid sweeping shakeup of UK payments infrastructure

By CBR Staff Writer

The backbone of the UK’s online banking infrastructure went down for four hours on Sunday, leaving nearly a million customers around the country chasing missing transactions.

Faster Payments, launched in 2008, processes virtually all internet and telephone banking payments across the UK; over 400 institutions have access to the service.

In October 2017 it invited bids from tech vendors for a comprehensive overhaul of its back-end infrastructure amid concerns it was no longer fit for purpose and vulnerable to cyber attack. (The winning bidder is expected to be announced in Q3, 2018).

A Faster Payments spokesman told Computer Business Review: “Faster Payments experienced intermittent issues with its central infrastructure today [Sunday], causing delays to payments submitted between 1 and 5.30pm.”

They added: “We are pleased to say that working with Vocalink, our infrastructure supplier, we have resolved the issue and the system is operating successfully at full capacity, with the backlog of payments submitted to Faster Payments now cleared.”

Mastercard’s Vocalink told Computer Business Review: “On Sunday 8th of July, we experienced an intermittent service issue on one of our multiple sites. The service is now operating normally and our teams are working 24/7 to ensure continuous service at all times.”

Faster Payments suggested it had yet to determine the clear cause of the outage: “We would like to apologise to all affected customers for the inconvenience. We will now work with Vocalink to conduct a full investigation into the cause of the issue.”

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The outage is the latest in a series of issues to plague online banking in the UK; three weeks earlier Visa blamed a component failure in a backup switch at its data centre for an outage in early June that resulted in 5.2 million card payments failing – and made a frank admission that software to automatically detect such failures was not in place.

online bankingMajor Shakeup of UK Online Banking System

The outage came just a week after Faster Payments’ new operator, the New Payments Systems Operator (NPSO) completed its consolidation of the UK’s retail payment systems and represents its first real test as a payments system operator.

The NPSO is responsible for processing £6.4 trillion payments each year, almost two and half times the UK’s GDP and is at the heart of sweeping changes to the UK’s payments infrastructure.

It was set up to take over three payment systems on the recommendations of the UK’s Payment Strategy Forum, which on 28 July 2017 delivered a blueprint for the construction of a ‘New Payments Architecture’.

It subsequently took on responsibility for running and managing the cheque paper and cheque image clearing systems on July 1 2018, eight weeks after having also taken responsibility of Bacs and Faster Payments on 1 May 2018.

The NPSO and the Bank  of England are pushing the creation of a new payments architecture with industry-wide use of ISO 20022 harmonised messaging standards, that will enable the transportation of richer payments data.

(ISO 20022 includes a modelling methodology to capture in a “syntax-independent way” financial business, business transactions and associated message flows; a central dictionary of business items used in financial communications and a set of XML and ASN.1 design rules to convert the message models into XML or ASN.1 schemas.)

In a speech earlier this year, David Bailey, Executive Director for Financial Market Infrastructure, Bank of England, said: “I think we would all agree that its [NPSO’s] continued resilience and smooth functioning is a matter of primary concern. Our priority throughout this transition has been to ensure that it has been and continues to be managed in a way that promotes the robustness and resilience of the payment systems, and of wider financial stability.”

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