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UK and European regulators are seeking answers from Google after a major cloud outage disrupted banking services across Western Europe, raising fresh questions about the financial sector’s dependence on a small number of critical technology providers.
Google Cloud Outage
The disruption lasted for around six hours on Tuesday and followed an electrical power interruption at a UK data centre facility serving Google Cloud customers across the region.
Several banks were affected, including Lloyds, HSBC and Revolut, with customers reporting problems accessing mobile banking, making card payments and withdrawing cash.
The European Banking Authority has asked Google Cloud for more information on the incident and its impact, while the UK Financial Conduct Authority has also confirmed that it is engaging with the technology group.
Cloud Concentration Risk Moves From Theory to Practice
The outage is significant because both the EU and UK have recently strengthened oversight of technology companies considered critical to financial services.
Google Cloud is already within the scope of both frameworks.
In the EU, regulators have begun direct oversight of designated critical third-party technology providers. In the UK, Google is one of four major cloud providers placed under the supervision of the FCA, Bank of England and Prudential Regulation Authority.
The rationale is straightforward: disruption at a single major technology supplier can affect multiple financial institutions simultaneously.
Tuesday’s incident provides a clear example of that systemic risk.
Banks Remain Responsible for Customer Services
Despite the greater focus on cloud providers, banks remain accountable for the services they deliver to customers.
That means financial institutions cannot outsource operational responsibility simply because an incident originates with a third-party supplier.
Revolut said a wide range of services had been affected, including app access, card payments and cash withdrawals. It also said customer funds and data remained safe and that it was reviewing the incident to reduce the impact of similar third-party failures in future.
Under the UK’s critical third-party regime, designated providers are also required to report serious disruptions to regulators.
Regulators Face First Major Test of New Oversight Rules
The outage is therefore an early test of whether Europe’s new regulatory frameworks can identify weaknesses in technology resilience before they become broader financial stability issues.
The UK Treasury Committee has written to the Bank of England and FCA seeking details on the scale of the disruption, the regulatory response and any financial harm caused.
The immediate cause may have been a power event, but the wider concern is structural.
As banking infrastructure becomes increasingly concentrated in a handful of cloud providers, operational resilience is no longer simply a technology issue. It is becoming a core question of financial stability, regulatory oversight and customer protection.
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