What you need to do if you’re a TSB customer, and my thoughts on if you switch to or from the bank.
Between us, Becky and I have six TSB Classic accounts. Two personal ones each, and two joint accounts. We opened them a few years back when we could get 5% interest on £2,000 – a great way to boost the money we were saving for our wedding. The rate has since been dropped to 3% on £1,500, but we still use the accounts now to stash some rainy day savings.
Luckily though we don’t use them for day-to-day banking. If we did we’d have had little or no way to check our accounts or transfer out money since the afternoon of 20th April – 11 days ago.
That’s when TSB started to move all its data to a new IT system. At first it was just meant to be for a couple of days, but soon it became clear there were issues. People could see money that wasn’t theirs, or had no access.
By the middle of last week things got a little better, and I’ve been able to log in OK most of the time. But not everyone can, causing all sorts of issues. There’s a good timeline over on the BBC News website if you want to read more.
The crisis is now well into the second week and it’s still not fixed! Last night Becky and I both tried to log in the same time. Fine for me, not for Becky.
Again, it hasn’t really affected us as we haven’t needed to transfer the cash, but for millions it’s been a huge issue. It’s a massive disaster for TSB, and could see not just a mass exodus from the bank, but also put people off switching to it.
Here’s what existing customers need to know, and my thoughts on whether you should stear clear of switching to the bank.
What to do if you’re already with TSB
TSB will have to pull out the stops to make this OK with customers. Here’s what’s been promised so far:
- No charges or overdraft fees for April
- Interest will increase from 3% to 5% from 2nd May
- No customer will be “out of pocket”
So this should mean any charges are automatically removed, while the interest automatically added (more on this below).
But the final promise that customers won’t be out of pocket is ambiguous. There’s been no information about how far this goes. You’d expect it to cover interest on a credit card because you’ve not been able to pay the bill, but what about if someone had to take out a loan? Or lost out on a big purchase they’d already put a non-refundable deposit down? How about time lost off work trying to sort things? Until we know, keep track of all extra costs you’ve incurred including receipts.
I don’t think it goes far enough. The extra 2% on £1,500 is just £29 a year. So that’s not much, and many won’t get that if they don’t have the full amount saved.
I’d hope to see further compensation, but it looks like to get that you’ll probably need to complain.
How to complain
If you want to ask for compensation you should get in touch with TSB and complain. All the details are on its website here.
As the crisis is still ongoing, it might be worth waiting until you know the full extent of the costs you’ve incurred.
It’s been reported that TSB has already paid out small amounts for the inconvenience too, so do ask for that when you complain.
Should you switch away from or to TSB?
Whether you’re an existing customer or not, you will probably find a better account out there for you and your needs, such as M&S Bank which offers £185 in vouchers for switching, or Nationwide which gives 5% interest for one year. Here’s my guide to all the current incentives. So if you’ve had enough, vote with your feet and switch away.
If you’re not with TSB. I’d expect some aggressive marketing and incentives from the bank this year to try tonab some new customers, especially if there’s an exodus of angry people affected over the last few weeks. And I think any offer will be worth considering.
Once this situation is resolved I don’t think TSB will be a bad bank to stick with. At least no worse than any of the others. However, until it is sorted, don’t go anywhere near it (in fact you probably can’t switch to it right now while they try to fix the systems).
I’m personally going to stay put. Across our six accounts, if full, we’re going to have £174 more over a year. I’ve also got a TSB credit card which pays 1% cashback, a decent back up if a retailer won’t take my American Express.
Of course, whoever I bank with I’d be worried it could happen again, and I’d certainly be trying to limit the impact of similar crashes. Check out my three tips to help protect you and your account from bank IT crashes.