Yahoo Finance Fears over large-scale job losses after Lloyds reveals shift to new IT system
Lloyds Banking Group could be considering job cuts in the UK after tabling plans to switch some of its IT systems to a new startup as part of cost-cutting measures.
The bank, which cut over a thousand roles in the last year alone in two different redundancy rounds as part of its three-year strategy to cut costs, is now planning to remove some back office IT functions to fintech startup Thought Machine, according to internal documents seen by the Financial Times.
The British high-street bank has entered into negotiations with regulators about transferring the data of 500,000 customers from its Intelligent Finance brand to test a new core banking system built by UK startup Thought Machine, the documents showed.
Lloyds declined to comment on the IT systems transfer or potential job losses.
BTU, the union that represents Lloyds Banking Group employees, said that 10,000 jobs are at risk.
BTU general secretary Mark Brown said: "What they are building is a completely new IT system, and that won't need anywhere near the number of people that are involved in the current IT system.
"If it works and doesn't collapse, it is going to completely change retail banking."
Lloyds will roll the technology out more widely if it proves effective, the union has claimed.
Lloyds announced an £11m strategic partnership with Thought Machine, which was set up by ex-Googler Paul Taylor, in November of last year.
At the time, Zak Mian, group director of transformation at Lloyds Banking Group, said: “A key part of our recently launched three-year strategic plan is applying technology innovation to meet our customers’ evolving needs.
"I’m really excited to work with the Thought Machine team to explore ways to simplify and enhance our IT architecture and helping on our journey to make banking easy and simple for customers.”
The bank currently holds a 10pc stake in the startup, which first launched in 2016 and builds cloud-based banking solutions.
