Santander accidentally pays out £130m in Christmas blunder - report

Santander was reportedly scrambling on Wednesday night to recover £130m accidentally paid out to tens of thousands of people and businesses on Christmas Day.

According to The Times, about 75,000 people and companies in receipt of normal one-off or regular payments from 2,000 businesses with accounts at the high street bank were inadvertently paid a second time. This included employees of the businesses and their suppliers.

The second payment was made from Santander’s own reserves, leaving the bank significantly out of pocket, but its own customers unaffected, The Times said.

The task of recovering the money is complicated by the fact that it has gone to the accounts of customers of dozens of other banks, which are now being asked to retrieve the money on Santander’s behalf. It was understood that account holders at Barclays, HSBC, NatWest, Co-operative Bank and Virgin Money are among those affected.

The Times said talks under the auspices of Pay UK, which runs the main payment systems in the UK, were taking place on Wednesday to work out how best to reverse the payments, with some of the money already clawed back.

Using a process known as "bank error recovery", Santander is approaching both the other party’s banks and in some cases going directly to recipients to retrieve the cash.

A Santander spokeswoman confirmed to The Times that there had been a problem.

"We’re sorry that due to a technical issue some payments from our corporate clients were incorrectly duplicated on the recipients’ accounts," she said. "None of our clients were at any point left out of pocket as a result and we are taking steps to recover the duplicated transactions in line with industry processes.

"The duplicated payments were the result of a scheduling issue, which we quickly identified and rectified. The recipients and purpose of payment will have varied among clients but could have included wages or supplier payments."