Software glitch in RBS triggers outcry

HYDERABAD: At a time when brand Hyderabad is looking to regain momentum, an error committed by a junior employee of the Royal Bank of Scotland (RBS) not only affected millions of customers globally but also triggered an outcry against outsourcing to low-cost destinations such as the bank's small centre in Hyderabad.

The incident happened at a time when RBS announced job cuts of upto 30,000 globally while at the same time seeming to be open to hiring in Hyderabad, its only development centre in India.

According to reports, information pertaining to RBS customers was wiped out during a routine software upgrade, leaving customers without access to their accounts.

It is estimated that the bank may have to shell out anything between '50 million and '100 million to customers as compensation for the error.

Amid allegations that at least one of the team members who carried out the upgrade was based at the Hyderabad facility. RBS CEO Stephen Hester denied that the error occurred at any of the company's overseas centres. When contacted, a senior official at RBS Hyderabad declined comment.

Sources in the trade body ITsAP were doubtful that such a crucial activity would be undertaken at a regional facility like Hyderabad. 'Typically, critical activities such as software upgrades are done at the global development centre,' Bipin Pendyala, ITsAP member, told.

The RBS Hyderabad centre, which was started more than two years ago, employs a little over 300 and offers customer service and other backoffice operations.

However, the episode has come in handy for unions at home to raise a hue and cry over outsourcing. 'The unions may be trying to find a reason to make this an issue and prevent further job cuts.

The company has made it clear that the glitch didn't occur overseas. I don't see any reason why this incident should affect Indian companies,' said a senior official of an IT company.

Sources in the industry asserted that the India angle may have been raked up in an attempt to prevent outsourcing of jobs by the premium banker.

Even though Indian IT companies command higher billing rates compared to say a decade ago, employees hired in cities here are still one-fifth cheaper than in the UK.

Industry sources also said there have been no such incidents in the past where employees were involved in either misusing customer details or causing irreparable damage.