In July, City Regulators told banks and financial organisations they have a ‘maximum outage time’ of just two days. The warning – and it is a warning –comes after several organisations in the UK’s financial services faced significant systems outages, stopping customers from accessing and spending.
These outages include the Faster Payments system, which is used by most of the UK’s banks and building societies,as well,as the huge outage from TSB back in April which was widely reported across the media. More recently, a hardware failure at Visa affected millions of accounts across Europe opened the company to considerable criticism.
These outages support a growing base of evidence the payments industry needs to change.Consumers are getting fed up. As reported by multiple leading media organisations, the key point raised by regulators in a joint paper by the FCA and Bank of England is a failure by financial institutions to provide operational resilience.
By October 5 this year,organisations in the sector must be ready to report how they intend to respond in case of significant disruption and further outages, which is not long at all
Resilience is underpinned by better testing
This growing number of service outages is not altogether surprising. The pace of technological change in financial services is accelerating at an immense pace. Young and eager FinTechs that thrive on change and have the ability to ‘think outside the box’ are bringing new ideas to the table; popular ideas that demand state-of-the-art technology if they are to be implemented successfully.
Mainstream financial organisations fall-down because they are rushing the testing process so they can bring offerings to market faster than the competition, even if it means cutting corners. This is a creating a problem which a quick analysis of social media makes very apparent; consumers do not hold back on venting their frustrations, nor do the media in reporting them.
To make improve their performance, banks and financial organisations, need to apply a more holistic approach to testing. At present, the patchy, bottom-up approach of fixing one problem at a time simply isn’t working – a far broader, more comprehensive approach is required. Organisations need to make sure they have the necessary technology and resources in place if they are tomake this happen.
When it comes to testing, short-circuiting the process will inevitably lead to problems further down the line. In the case of TSB back in April, for example, the two IT contractors who managed the migration told the media the outage was down to rushed, poorly designed testing; not exactly the kind of message you want to be sent to the people whose money you are meant to be looking after.
Testing known unknows
Testing can be an intimidating task, particularly when what’s being tested is relatively novel and even more so when the resources allocated to testing are slim. One of the biggest challenges financial organisation will now face is how to automate testing so it’s both effective and efficient. Manual testing, as illustrated by the incidents referred to earlier, no longer cuts it in either respect.
Under the older manual-testing models, each time there is an update, the entire system will have to be re-tested, which can take months. Given market forces now demand new services and new functionality all the time, it is unrealistic to expect an organisation to constantly adapt and test comprehensively.
Payment organisations need a fresh approach and to look to new-testing technology; technology that was not built to cater to systems designed in the 1980s and 1990s. After all, the level of complexity in payments systems and consumer expectation is only going to increase in the years ahead as technology continues to improve.
In the case of ATMs, for example, the key to success is to automate the testing of software in the same manner that consumers will use it, which needs well-defined scenarios and workflows.This requires the application code, cards, appropriate test data, ATMs and peripherals, device simulations, host connections, certifications and security controls that mirror the eventual live placement location. By adopting this model, test maintenance is drastically reduced, and test creation efficiency improved.
Financial organisations’ must adapt their thinking
The testing element of any payments system is mission-critical. It underpins banks and financial services organisations ability to operate reliably and to guarantee functionality and accessibility to consumers.
End-to-end testing technology that guarantees this already exists, and it is now up to organisations to adjust their thinking and invest in the right systems by dedicating an appropriate level of resource to the testing procedure. Financial organisations are going to have to change; not just their systems, but their attitude toward payment solution services, particularly in terms of resources.
The way financial institutions operate and test their systems, particularly now technology never stops changing, must improve if the industry is to embrace the inevitable payments transformation.
Author: Mohit Singh, vice president – quality assurance at Renovite Technologies
Bio:Mohit Singh is an automation specialist with over 17-years working in the IT sector. During this time, he has pioneered Open source tools and designed and developednext-gen Test automation tools aligned with emerging trends in technology.
Oil rises on positive forecasts, slow U.S. output restart
By Bozorgmehr Sharafedin
LONDON (Reuters) – Oil prices rose on Tuesday, underpinned by the likely easing of COVID-19 lockdowns around the world, positive economic forecasts and lower output as U.S. supplies were slow to return after a deep freeze in Texas shut down crude production.
Brent crude was up 36 cents, or 0.5%, at $65.60 a barrel by 1212 GMT, and U.S. crude rose 39 cents, or 0.6%, to $62.09 a barrel.
Both contracts rose more than $1 earlier in the session.
“Vaccine news is helping oil, as the likely removal of mobility restrictions over the coming months on the back of vaccine rollouts should further boost the oil demand and price recovery,” said UBS oil analyst Giovanni Staunovo.
Commerzbank analyst Eugen Weinberg said optimistic oil price forecasts issued by leading U.S. brokers had also contributed to the latest upswing in prices.
Goldman Sachs expects Brent prices to reach $70 per barrel in the second quarter from the $60 it predicted previously, and $75 in the third quarter from $65 forecast earlier.
Morgan Stanley expects Brent crude to climb to $70 in the third quarter.
“New COVID-19 cases are falling fast globally, mobility statistics are bottoming out and are starting to improve, and in non-OECD countries, refineries are already running as hard as before COVID-19,” Morgan Stanley said in a note.
Bank of America said Brent prices could temporarily spike to $70 per barrel in the second quarter.
Disruptions in Texas caused by last week’s winter storm also supported oil prices. Some U.S. shale producers forecast lower oil output in the first quarter.
Stockpiles of U.S. crude oil and refined products likely declined last week, a preliminary Reuters poll showed on Monday.
A weaker dollar also provided some support to oil as crude prices tend to move inversely to the U.S. currency.
(Reporting by Bozorgmehr Sharafedin in London, additional reporting by Jessica Jaganathan in Singapore; editing by David Evans and John Stonestreet)
UK-Japan trade deal settled nerves for Japanese firms, Honda executive says
LONDON (Reuters) – Britain’s trade deal with Japan settled the nerves of a lot of Japanese businesses in the United Kingdom and gives them confidence about their future prospects there, a senior Honda executive said on Tuesday.
Japan, the world’s third-largest economy, has since the 1980s made the United Kingdom its favoured European destination for investment, with the likes of Nissan, Toyota and Honda using the country as a launchpad into Europe.
But Britain’s shock 2016 decision to leave the European Union had prompted Japan to express unusually strong public concerns. Their companies and investors warned that a disorderly exit from the EU would force them to rethink their four-decade bet on Britain.
“We welcome very much the Japanese trade agreement which as a Japanese businesses was very welcomed,” Ian Howells, senior vice president at Honda Motor Europe, told a parliamentary committee.
“On the point around confidence, that certainly amongst my peers in Japanese companies was very much welcomed, and probably settled a lot of nerves in terms of their trading prospects in the UK going forward.”
Britain and Japan formally signed a trade agreement in October, marking Britain’s first big post-Brexit deal on trade. It has also made a formal request to join the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), of which Japan is also a member.
(Reporting by Kate Holton)
UK retailers see sharp fall in sales and mounting job losses, CBI says
LONDON (Reuters) – British retail sales fell in the year to February as stores cut jobs at a rapid rate, with only supermarkets reporting any growth during the latest COVID-19 lockdown, a survey showed on Thursday.
The Confederation of British Industry’s gauge of retail sales stood at -45, up only slightly from January’s eight-month low of -50. The measure points to falling sales and is below the consensus forecast of -38 in a Reuters poll of economists.
Retailers’ expectations for March – when non-essential shops will remain closed to the public as part of lockdown measures – fell to -62, the lowest since the series began in 1983.
In another sign of a changing consumer habits during lockdown, the survey’s gauge of internet retail sales hit a new record high.
“With lockdown measures still in place, trading conditions remain extremely difficult for retailers,” said Ben Jones, principal economist at the CBI.
“Record growth in internet shopping suggests that retailers’ investments in on-line platforms and click-and-collect services may be paying off, but the re-opening of the sector can’t come soon enough to protect jobs and breathe life back into the sector.”
Job losses among retailers accelerated according to a quarterly question in the survey. For the distribution sector as a whole, which includes wholesalers and car dealers, employment fell at a record rate, the CBI survey showed.
(Reporting by Andy Bruce, editing by David Milliken)
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