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Banking Outage Prevention Tips

A series of fresh technology shutdowns this spring at banks around the world reveals the financial services industry still has a long way to go toward ensuring full up time for networks, as well as communicating with the public about why tech glitches have happened and what is being done about them.

In May, Santander, Barclays and HSBC were all hit by digital banking outages. Some customers of Barclays and Santander were unable to access accounts online for a time near the end of the month, an outage blamed largely on end-of-the-month transaction volume. At HSBC, an IT hardware failure temporarily rendered ATMs unable to dispense cash or accept card payments in the U.K. Barclays and Santander both apologized for the outages though statements, while HSBC's approach revealed both the power and peril of social media in such cases.

HSBC's PR office took to social media to communicate updates on the outage, and to also receive criticism about the outage (HSBC, Santander and Barclays did not return queries for comment). After an earlier outage in November, HSBC had set up a social monitoring team to be more proactive about communicating with the public about tech glitches, a move that seemed to have some positive impact, as not all of the Twitter and Facebook postings about the most recent outage were complaints.

The basic task of making sure the rails are working, and smoothing things over with customers when systems invariably shut down, is an even more pressing matter considering the propensity for outrage to spread quickly among the public via new channels.

"One thing that's true about outages is we're hearing more about them. The prevalence of social media use by irate customers and even employees makes these outages more publicized," says Jacob Jegher, a senior analyst at Celent.

Jegher says the use of social media for outage communication is tough - balancing the need to communicate with customers with internal tech propriety is easier said than done. "While it's certainly not the institution's job nor should it be their job to go into every technical detail, it's helpful to provide some sort of consistent messaging with updates, so customers know that the bank is listening to them," Jegher says.

National Australia Bank, which suffered from a series of periodic online outages about a year ago that left millions of people unable to access paychecks, responded with new due diligence and communications programs. In an email response to BTN, National Australia Bank Chief Information Officer Adam Bennett said the bank has since reduced incident numbers by as much as 40 percent through a project that has aimed to improve testing. He said that if an incident does occur, the bank communicates via social media channels, with regular updates and individual responses to consumers where possible.

The bank also issued an additional statement to BTN, saying "while the transaction and data demands on systems have grown exponentially in recent years led by online and mobile banking, the rate of incidents has steadily declined due to a culture of continuous improvement...The team tests and uses a range of business continuity plans. While we don't disclose the specifics, whenever possible we will evoke these plans to allow the customer experience to continue uninterrupted."

While communicating information about outages is good, it's obviously better to prevent them in the first place.

Coastal Bank & Trust, a $66 million-asset community bank based in Wilmington, N.C., has outsourced its monitoring and recovery, using disaster recovery support from Safe Systems, a business continuity firm, to vet for outage threats, supply backup server support in the event of an outage, and contribute to the bank's preparation and response to mandatory yearly penetration and vulnerability tests.

"Safe Systems makes sure that the IP addresses are accessible and helps with those scans," says Renee Rhodes, chief compliance and operations officer for Coastal Bank & Trust.

The bank has also outsourced security monitoring to Gladiator, a Jack Henry enterprise security monitoring product that scours the bank's IT network to flag activity that could indicate a potential outage or external attack. The security updates include weekly virus scans and patches.

Coastal Bank & Trust's size - it has only 13 employees - makes digital banking a must for competitive reasons, which increases both the threat of downtime and the burden of maintaining access.

"We do mobile, remote deposit capture, all of the products that the largest banks have. I am a network administrator, and one of my co-workers is a security officer. With that being said, none of us has an IT background," Rhodes says. "I don't know if I could put a number on how important it is to have these systems up and running."

Much of the effort toward managing downtime risk is identifying and thwarting external threats that could render systems inoperable for a period of time.




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