UK salary payments hit by glitch at APACS

Around 400,000 UK monthly and weekly salaries due to be paid today will not go through on time, the Association for Payment Clearing Services (APACS) has announced.

A spokesperson from APACS told us that the BACS system, used for the payment of regular sums such as wages, suffered a database error but was now working properly following an internal investigation. "What happened was that the system slowed down or was working slowly, and this caused payment submissions to log jam up ... a traffic jam," we were told. "So an investigation got underway and the problem was isolated to a database issue. A patch was identified, and it worked."

The problem was not down to virus activity or human error, he said, but could not disclose any further detail of the issue, or the software affected.

BACS is one of the largest automated clearing houses in the world with salaries from 90 per cent of UK employees paid through the system each month.

"The entire banking and payments industry is extremely sorry that this has happened and we are working to resolve the issue and limit the impact on individual customers," said APACS in a statement. "We are confident that all affected individuals will have received their normal salary payment by Monday April 2nd 2007."

The body apologised to customers on behalf of the banking and payments industry. It said its "clear priority is to ensure that customers are not out-of-pocket and that any customers affected will not miss any payments being made (like monthly mortgage payments) or suffer any charges for being overdrawn, where this has been caused by the missed salary payment."

The spokesperson told us that it is up to customers to "raise issues with their banks re missed mortgage payments and incurred charges as a result".

BACS has a good record, with the last such disruption happening almost exactly 10 years ago when telecommunications equipment failed.