Following the news that US tech giant Amazon Web Services (AWS) experienced server trouble, affecting a wide range of apps including Lloyds Bank and its subsidiaries; Jonathan Vaughan Burleigh, Associate Analyst, Banking and Payments at GlobalData, publishers of RBI, says:
“The early months of 2025 saw a plethora of UK high street banks including Barclays and HSBC affected by IT failures resulting from overcapacity in legacy infrastructure, disrupting payments and everyday banking activity for hundreds of thousands of customers. Banks of all sizes around the globe have focused on cloud migration, which has been touted as a panacea to the issues caused by legacy architecture while increasing operational efficiency.
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GlobalData 2025 Financial Services consumer survey
“However, the AWS outage on 20 October 2025 highlights that even the most pioneering banking technology is prone to reliability issues. In the UK, Lloyds, Halifax, and Bank of Scotland were affected by the server problems, affecting up to 25% of UK consumers, according to GlobalData’s 2025 Financial Services consumer survey. Customers struggled with completing payments and accessing their bank accounts, causing significant frustration which is likely to impact the banks’ consumer acquisition and retention rates.
“Amazon has made a statement suggesting that the issue was a result of a data storage glitch on some of its US servers. This reinforces the idea that advanced cloud banking architecture is subject to the same weaknesses as legacy technology, alongside the risk of cyberattacks and potential overload during peak periods.
“To ensure consumers always have access to their finances, banks must find a strategic approach to minimising cost and maximising reliability. While cloud systems are more efficient, banks are placing their trust in third-party server providers, reducing their ability to address the problems affecting their consumers. Physical infrastructure is costly and lacks agility, though may need to be maintained by banks as backup when online services fail.”
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By GlobalData
