Financial services face outages costing USD $2.2 million per hour

A report from New Relic examining observability in the financial services and insurance sector has found that high-business-impact outages cost these industries a median of USD $2.2 million per hour.

The State of Observability for Financial Services and Insurance report draws on survey insights from professionals in these industries as part of New Relic's 2024 Observability Forecast.

The report highlights that nearly half (48%) of respondents experience significant business-impacting outages at least weekly, a rate higher than most other sectors.

Adoption of artificial intelligence emerges as an important driver of observability practices, with 41% of respondents identifying AI as central to their observability strategies.

Nic Benders, Chief Technical Strategist at New Relic, said: "Financial services and insurance organisations are navigating a fast-moving digital landscape where reliability, security, and operational efficiency are non-negotiable. These businesses grapple with frequent high-impact outages, complex tool sprawl, and mounting regulatory pressures, all while striving to deliver seamless digital experiences. The report's findings demonstrate how critical observability is in helping businesses reduce costly downtime, leveraging AI, and modernising legacy systems to meet rising customer expectations while maintaining compliance. Observability is no longer just a technical practice; it is mission critical."

The financial consequences of outages are significant according to the report, with the USD $2.2 million hourly cost standing 16% above the median across all sectors.

Simon Lee, Senior Vice President and Managing Director, Asia Pacific and Japan at New Relic, commented: "A $2.2 million-per-hour impact shows just how quickly disruption can hit — especially for financial services and insurance companies operating in complex digital ecosystems. Across APAC, firms are under growing pressure to modernise their observability strategies and move faster to prevent downtime before it impacts customers. AI-driven observability is giving early adopters the speed and clarity to stay ahead of issues, but too many organisations are still lagging. In a region where digital engagement is accelerating and downtime can instantly erode customer trust, organisations simply cannot afford to treat observability as optional. Strengthening digital resilience isn't just about protecting the business — it's about unlocking the confidence to innovate, grow, and lead into the future."

The research identifies financial modernisation and digital transformation as key priorities for the industry, with institutions migrating to the cloud, developing digital-native subsidiaries, and adopting technologies such as AI.

The report states that 34% of those surveyed view AI-assisted troubleshooting as an important factor in improving observability, and 42% plan to consolidate their toolsets over the coming year to address issues such as tool sprawl and fragmented data.

Cloud-native application development is more prevalent in the financial services and insurance sectors than in other industries, with a 36% adoption rate compared to the 31% cross-sector average. Similarly, containerised workloads are utilised by 28% of surveyed organisations, above the 23% industry-wide figure.

These approaches, combined with observability solutions, are intended to support agility and competitiveness in digital business environments.

AI adoption is also seen to accelerate observability uptake, with 32% of respondents citing automatic root cause analysis and 32% highlighting AI-assisted remediation actions as opportunities to enhance observability practices.

Despite increasing adoption of modern technology, the report notes persistent challenges around downtime and associated costs. Median mean time to detection (MTTD) for critical outages is 42 minutes, and mean time to resolution (MTTR) stands at 58 minutes, both of which are higher than the industry average. Full-stack observability, however, is shown to bring improvements to these response times, reducing both financial and reputational risks related to outages.

Almost half (49%) of respondents expressed a preference for a single observability platform, citing system simplification and improved investment value as motivating factors. Tool consolidation is seen as key to overcoming hurdles such as data silos and ensuring comprehensive visibility across technology stacks.

The report also documents a median annual return on investment (ROI) of 297% from observability initiatives.

Respondents point out that these investments help minimise downtime, improve operational efficiency, and support customer experiences by making systems more reliable and responsive.

According to the survey, 49% believe observability has a direct impact on system uptime, while 42% link it to operational efficiency improvements. Many practitioners find observability increases productivity by enabling quicker troubleshooting and more effective management of complex infrastructure.

Carlos Pedrosa, IT Director at Banco Inter, said: "Customers must have a digital experience with high performance, usability, and accessibility. New Relic is the main tool today for internal decision-making. Not only technology decisions—but also strategic decisions."