Retail

‘Losing sales left, right and centre’: Telstra outage wipes out card payments for Aussie businesses

Dominic Powell /

An unexpected Telstra outage just before midday yesterday wreaked havoc on Australian businesses, who suddenly found themselves without access to eftpos payment systems.

The outage, which occurred about 3pm yesterday, wiped out the connections for eftpos terminals and ATMs using the Telstra network, causing chaos at some businesses as customers were forced to pay only in cash.

The outage continued for approximately three hours before it was resolved at about 6pm. In a statement, Telstra apologised for the outage, and blamed it on an unusually high amount of traffic coming from New South Wales.

“We are continuing to investigate the exact cause of this issues but early investigations suggest it was caused by an unusually large volume of traffic across network links in NSW,” the company said in a statement.

“We apologise for the interruption to some data services yesterday afternoon. We know how frustrating this was and worked to restore them as quickly as possible.”

Major retailers such as Woolworths and Coles were left only able to accept cash, and the country’s big four banks all had their services affected, with some entire bank branches put out of operation thanks to the outage.

Other businesses took to Twitter to express their unhappiness at the outage, with one person saying they were losing sales “left right and centre”.

Dominique Lamb, chief executive of the National Retail Association, told The Age she estimates the outages to have cost retailers upwards of $100 million.

“We know that basically, they were finding it very difficult to trade for the second half of that day which is ultimately going to have an impact … we’re predicting it’s going to be up to $100 million,” she said.

With the outage occurring after work on a Thursday ⁠— payday for many⁠ — potential losses could have been exacerbated for retailers in the convenience sector. Additionally, last night was the draw for an $80 million PowerBall, raising concerns for newsagents who may have been denied much-needed lotto ticket sales.

Speaking to SmartCompany, newsagent owner and general manager of the Australian Lottery and Newsagents Association Ibram Kamil said the outage could have been a lot worse than it was.

“It started early in the day of one of the biggest PowerBalls in Australian history, but we quickly realised while customers couldn’t insert or swipe cards, they could still tap them,” he says.

“But not everyone has paypass, so some still had to go get cash out from the ATM.”

Kamil says it’s hard to know how much the outage affected sales for newsagents across the country, as sales are usually up on big PowerBall weeks, but says the outage was still disruptive.

“It’s definitely a bit of bad luck, but I’m grateful that it happened to everyone and not just us. I think because everyone could see that it was an outage everywhere they were a bit more patient.”

“I’m just hoping it doesn’t happen again next week for the $110 million PowerBall.”

Jeff Rogut, chief executive of the Australasian Association of Convenience Stores, told SmartCompany he hadn’t heard any reports of significant issues with his customers, though some service station and convenience store owners said they’d had some grumpy customers.

“They had a few annoyed customers and it was certainly a nuisance, and when people are aggravated they do take it out on retail staff,” he says.

“But fortunately these outages are reasonably unusual.”

This isn’t the first time Telstra’s systems have led to an eftpos outage, with a similar one occurring last November. At the time, the Telecommunications Ombudsman noted customers may be entitled to compensation, but should attempt to have things resolved by Telstra first.

SmartCompany understands the Telecommunications Ombudsman is currently investigating the cause of the outage to determine if the issue falls under its jurisdiction.

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Dominic Powell

Dominic is the former features and profiles editor at SmartCompany.