This article first appeared in The Edge Malaysia Weekly on April 15, 2024 - April 21, 2024

Bank Negara Malaysia’s statement last Tuesday demanding a thorough explanation from Malayan Banking Bhd and CIMB Group Holdings Bhd (not named in the statement but the giveaway was “two of our largest banking institutions”) for recent outages of their services is a surprising but much needed move to ensure accountability to thousands of customers for disruptions that inconvenienced them.

The regulator stressed that it takes a serious view of the recent interruption of banking services.

Bank Negara offered no details of when or how banking services were disrupted but it is understood that outages at CIMB on April 8 lasted nearly three hours while Maybank took more than two hours to restore services on April 5.

With many banking services digitalised these days, service outages cannot be avoided sometimes, but it would be a mistake to normalise these disruptions. Hence, Bank Negara is right to ask the two banks to get to the bottom of the breakdowns so that corrective and preventive measures can be taken to avoid a recurrence.

This will ensure that all the banks, including the new entrants — digital banks — stay vigilant against service outages and serious threats such as cyberattacks.

Service outages are not only a major inconvenience to the customers of the affected banks but they are also bad for business as payments or transfers of funds cannot be carried out.

Then there is the damage to reputation to be considered — no thanks to the prevalence of social media.

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