Standard Bank’s connection seems unstable — in more ways than one

South Africa’s biggest bank called a meeting with journalists yesterday in an attempt to save face after its systems went down at the weekend in an epic six-hour crash, leaving millions of consumers unable to use their bank cards at cash machines or till points.

Although Standard Bank’s management was entirely apologetic and said all the right things, it failed to comprehensively explain what the problem was or give any detail on how it intended to make sure it wouldn’t happen again, beyond vague promises that “we will do our utmost to ensure this does not happen again”.

“We felt it would be important to present ourselves… to take ownership of what happened last weekend and to express our heartfelt and most sincere apology for the inconvenience caused,” said Lungila Fuzile, chief executive of Standard Bank.

“On Saturday, some of our services were partially inaccessible at first, and later were wholly inaccessible to most of our clients. We became aware of the problem at around 7.30am and the downtime lasted for about six hours.” 

https://www.dailymaverick.co.za/article/2022-05-24-give-me-18-to-36-months-says-joburg-mayor-mpho-phalatse-to-residents-buckling-under-endless-blackouts/

Fuzile said management felt “duty bound” to apologise due to the massive impact of the incident. 

Khomotso Molabe, chief engineering officer at Standard Bank, noted that most clients were out and about with families or opening businesses at the time. 

“What made the situation worse is… the component that failed also affected our ATMs so consumers were not able to withdraw cash as an alternative.”

He told journalists this was “the first time we had a problem with this component in the last four years”.

However, Standard Bank consumers faced “downtime” in May and December 2021, February and March this year and again at the beginning of May, prior to the incident last weekend. 

When pressed on this, Molabe responded that the previous incidents were unrelated, attributing them to a “software bug”.

In addition to the disconnection problems that customers are facing, management seems to be disconnected from the reality that their systems have repeatedly failed. Whether component A or component C is responsible for the failure is of little consequence to consumers stranded at till points or without cash.

Business Maverick knows of a Standard Bank private client who had taken his family away for the weekend and was left stranded at King Shaka airport for two hours with two small children. He was unable to collect his rental car because his bank card was not working and couldn’t call an Uber for the same reason. He also had to borrow money to pay for emergency accommodation at a hotel.

As part of his assurances, Molabe referred to the digitisation of Standard Bank, saying the bank was now transitioning from a financial services company to a “platform services company”.

While pressure from increased competition in the form of fintech disruptors such as TymeBank and Bank Zero may well have pushed Standard Bank to try to play catch-up, it is unlikely to attract or retain consumers if its primary business model — banking — seems to be falling by the wayside. BM/DM

 

[hearken id="daily-maverick/9472"]