The Royal Bank of Scotland was fined for "very serious" failings that left customers unable to access "basic banking services", said Tracey McDermott from the Financial Conduct Authority.
Business Secretary Vince Cable said the Royal Bank of Scotland's IT systems were "decades out of date" after the bank was fined £56 million for a computer failure that left customers unable to access their accounts.
This is another disastrous fine for RBS after a series of failures. RBS's priorities under Fred Goodwin meant that it neglected its IT systems, which in some cases are now decades out of date.
The new management is taking action by compensating people and investing in new IT which is right, but in many cases it's too little too late.
What matters now is that RBS can continue to overhaul its digital infrastructure to provide the modern services customers and businesses rightly expect.
The Financial Conduct Authority said it fined the Royal Bank of Scotland for failing put in place resilient IT systems.
Tracey McDermott, director of enforcement and financial crime at the FCA, said:
Modern banking depends on effective, reliable and resilient IT systems. The banks' failures meant millions of customers were unable to carry out the banking transactions which keep businesses and people's everyday lives moving.
The problems arose due to failures at many levels within the RBS Group to identify and manage the risks which can flow from disruptive IT incidents and the result was that RBS customers were left exposed to these risks.
A computer systems failure at RBS, Natwest and Ulster Bank in 2012 affected 6.5 million customers - around 10 percent of the entire UK population.
10% of uk population was hit by the RBS/NatWest computer failure in 2012
The RBS group was today fined £56 million over the crash.
RBS chairman Philip Hampton has apologised to the bank's customers for the "unacceptable weakness" in its IT systems that left many unable to access their accounts.
Our IT failure in the summer of 2012 revealed unacceptable weaknesses in our systems and caused significant stress for many of our customers. I again want to apologise to all customers in the UK and Ireland that we let down.
I am confident that the progress we have made in increasing the resilience of our IT systems.
Natwest and Ulster Bank are among the banks that have been hit with a fine for the Royal Bank of Scotland group over IT failures.
The total fine for RBS - which includes all three banks - is £56 million.
The Royal Bank of Scotland has been fined a total of £56 million by regulators for failings in relation to major IT problems suffered by customers in 2012.
Royal Bank of Scotland has reported third quarter profits of £1.27 billion, compared with a loss of £634 million in the same period last year.
It is the first time the bank has reported a profit for three quarters in a row since the height of the financial crisis, in which the bank nearly collapsed.
RBS also said it was setting aside £400 million to settle foreign exchange rate-rigging allegations.
RBS, which is 80% owned by the taxpayer after being rescued during the financial crisis, said it was putting aside a further £100 million to cover compensation payouts for customers mis-sold payment protection insurance.