Software is taking over the financial industry as digital banking becomes more important and clients’ demands become greater. As a result of this need, guaranteed software quality has obviously become necessary for system performance and optimum customer experience.

Data breaches due to poor software quality

Obviously, this is not the only case where an organization has faced serious software quality issues. Lately banks and financial services organisations, have been hit by a variety of software faults. For example, JPMorgan Chase reported a massive cyber-attack against their servers, causing data breach and substantial losses that shattered the perceptions of banks being safe from data breaches. As a result of a software glitch, as many as 625 customers of Wells Fargo were “incorrectly denied a loan modification,” with 400 then having their homes foreclosed upon. Reports show that cyber-attacks are increasing at a fast rate, with 18% of total operational incidents at banks caused by these.

Outages due to poor software quality

Software outages have become a common occurrence in banking as people begin to rely more on digital transactions. In fact, the total number of debit card transactions has recently outstripped cash transactions.

Lloyds Bank’s customers were recently having intermittent problems logging on to their online bank accounts and it’s believed that at least 400,000 transactions have been delayed. Barclays, Royal Bank of Scotland (RBS) and NatWest customers also experienced problems accessing mobile and internet banking due to technical glitches that left hundreds of people panicking about how to access their money for the Bank Holiday weekend.

Barclays customers were unable to use the bank’s mobile banking app, and customers of RBS and NatWest – which are both part of the RBS Group – were unable to use mobile and internet banking services. The most common root cause of these incidents reported is IT change, banking requirements change too rapidly to make it practical to test software and make it reliable. Banks are used to IT change, but the sheer volume of changes is causing problems. The IT problems at TSB this year is an example of the difficulty traditional banks and financial services firms have with upgrading IT to keep up with customer demand.

There is a common factor in each instance which is poor software quality. Banks can expect to see a decrease in performance and jeopardizing their software security when not giving enough attention to application robustness. Stories of customers locked out of their banking accounts and whole payment systems collapse, have become an everyday casualty.

Bottom line, poor software quality can cost more to build and maintain, and it can affect operational performance, increase users error rates, and reduce revenues due to poor customer experience and inability to retain or acquire new clients.