There was a big increase in the number and duration of retail payment service outages in the 2019/20 financial year, prompting the Reserve Bank to get tough with the payments sector.
According to the Payments System Board annual report, the number of incidents has risen from a little over 200 a year in the years from 2014/15 to 2017/18 to more than 400 last financial year.
The average duration has gone from around four hours a few years ago to close to six hours last year.
The Reserve Bank has started working with the banking industry on measures to improve reliability.
It has “enhanced” its data collection and developed a standard set of statistics on operational outages to be publicly disclosed by institutions.
“Better and more transparent information about the reliability of retail payment services is intended to raise the profile of this issue among financial institutions and their customers, and enable improved measurement and benchmarking of operational performance,” the PSB said.
These new reporting requirements are expected to be introduced in the middle of next year.
Online or mobile banking services account for around half the number of outages, while disruption to card and NPP payment services were each about 10 per cent of the total.
Software failures were reported as the leading cause of outages. There were increasing problems with telecommunications infrastructure and payments services provided by third parties.
COVID-19 has been challenging, as payments providers have had to adjust to new working arrangements. Another challenge has been an increase in cyber attacks targeting financial institutions.