Challenger bank TSB is to open a dedicated IT centre as part of its drive towards digital banking.
The new project will be based at its Edinburgh HQ and will create 100 technology jobs.
It is a major part of the bank’s £120 million three-year plan announced after its massive IT meltdown in 2018 and will serve its five million customers.
Scheduled for opening in April, it will house IT specialists, data engineers and analysts.
The project also includes a partnership with IBM to run its key banking platforms, ATM network, digital banking and high street branch systems.
Two years ago, more than two million of the bank’s customers lost access to online services in a massive IT breakdown as the bank tried to switch data from its previous owner – Lloyds Banking Group – to its new owner – Sabadell.
What should have been a simple switchover went badly wrong when the two systems failed to communicate. Chief executive Paul Pester stepped down after around 1.9 million people couldn’t access their own money for several weeks.
The bank’s annual report later revealed the fiasco had cost £330.2 million, forcing the bank £150.4 million into the red.
Taking the business forward
Customer banking director, Robin Bulloch, said: “I’m deeply sorry for the trouble and inconvenience that was caused at our IT migration, but this is about taking the business forward.”
He said the new centre would be working on the ‘very strong banking platform’ provided by Sabadell and give customers the better online banking service they want.
He added: “The new TSB digital services will help customers to save and budget as well as being able to look at their balances and transfer money.
IBM are a large-scale IT provider and we’re very confident they will help support us in terms of building our propositions and ensuring the on-going stability of our banking platform.”
Half of all TSB products are now bought online and the bank expects that to increase to 80%. The race to improve digital services also includes RBS, Virgin Money, Lloyds and Barclays who are all investing heavily in their online businesses.
Mr Bulloch also mentioned the downside of the expansion into online banking by confirming 17 branches in Scotland will be closed this year.
He said: “We’re seeing less and less footfall in our branches. It’s one of the most difficult decisions that I have to make.
“What we’re seeing is more and more customers going online, and for those customers that are going to be impacted by branches that are closing, we work very closely with them to help educate them on other ways of banking, such as over the phone and online.”