LONDON (Reuters) - The boss of Britain’s biggest retail bank told lawmakers a proposal to stimulate competition by creating an industry-shared IT platform would be too difficult to implement and not achieve its objective.
The Parliamentary Commission on Banking Standards is considering recommending the industry adopts a uniform IT system that would place all banks on the same network.
However, Lloyds Banking Group’s Chief Executive Antonio Horta-Osorio said such a move would, in fact, favor incumbents and stifle competition and innovation.
“It would be like a return to the limited competition on the BT utility platform in the 1980s when there was no effective competing infrastructure and unstable and temporary competitors,” he said in a letter to the commission.
Horta-Osorio added that the proposal would create the risk that any network failure would result in nationwide problems.
Millions of Royal Bank of Scotland’s customers endured massive disruption last year when a computer glitch led to its NatWest division being unable to process payments.
Reporting by Matt Scuffham; Editing by Mike Nesbit