Barclays to Pay Millions in Compensation for IT Outages that Disrupted Customers

By Evans Momodu
2 minute digest
Published 14:50 UK GMT, March 06, 2025


Barclays Bank is set to pay between £5 million and £7.5 million in compensation to customers affected by a major IT outage that caused widespread banking disruptions, according to a new letter to MPs.

This will be the largest compensation payout by any UK bank in the past two years, and the total could reach £12.5 million when factoring in outages from January 2023 to February 2025, according to the Treasury Committee of MPs.

What Caused the Barclays Banking Outage?

• The glitch began in late January 2025, lasting several days.
• It coincided with payday for many customers and the self-assessment tax return deadline.
• The issue was caused by severe degradation in Barclays’ mainframe computer system, affecting bulk data processing.
• 56% of online payments failed, forcing Barclays to deploy a software fix that is still undergoing comprehensive testing.

HHow to Get Barclays Compensation

1. Automatic refunds: Some affected customers will receive compensation automatically.
2. Direct contact: Others may be contacted for additional details.
3. No action needed for most customers.

More Fraud Expected Following Barclays Outage

Barclays has warned of an increase in fraud reports following the banking failure. The Treasury Committee is investigating all UK banks that have experienced IT issues preventing customers from accessing their funds.

Treasury Committee Chair Meg Hillier said the bank has already identified some fraud cases linked to the incident, but reporting such incidents can take several weeks.

Biggest Banking Compensation Payout in Two Years

• Barclays: £5M–£7.5M (up to £12.5M total)
• Bank of Ireland: £350,000

This compensation sum far surpasses the £350,000 paid by Bank of Ireland, making it the largest customer payout by a UK bank in recent history.

Treasury Committee Banking Investigation

• Barclays continues to assess the full impact and identify all affected customers.
• The Treasury Committee’s investigation into UK banking IT failures is ongoing.
• Customers should remain vigilant against potential fraud related to the outage.

If you were affected by Barclays' banking disruption, keep an eye on your bank account for automatic compensation or further instructions from the bank.
Source: Sky news