Ulster Bank has released the details of a financial package aimed at compensating more than half a million customers affected by the collapse of the bank’s computer systems.

The system outage affected more than 600,000 customers in June and July.

Many were denied access to their funds, suffered delayed payments and could not view correct balances. The problem was caused by a corrupted software update applied to the systems at the bank’s parent, Royal Bank of Scotland, in the middle of June.

The refund scheme, which will cost Ulster Bank well in excess of the bank's intitial estimate of €35 million, has been broadly welcomed.

Consumer Association of Ireland chief executive Dermott Jewell described it as “a mixed bag”, while Fianna Fáil finance spokesman Michael McGrath called it “fair and reasonable”.

Ulster Bank will start reimbursing “reasonable out of pocket expenses” that customers incurred from next Monday and has committed to paying an additional 20 per cent on top of these expenses up to a maximum of €120 for personal and SME customers.

Personal and current account customers who were forced to call into bank branches to withdraw funds because their accounts were not being updated will be given a once-off payment of €25 providing it was outside the normal pattern of their banking.

People with savings accounts will be given an automatic one-off payment equating to an additional rate for three months of 0.25 per cent AER on the average daily balance over the next three months.

The bank also said that some fees, charges and interest will be waived for three months and said no account maintenance fees for personal current account customers will be introduced before July 2013.

Ulster Bank said it was “already proactively refunding all fees, charges and debit interest which may have been charged in error and correcting any credit interest owed to personal, SME and corporate customers’ accounts as a result of this incident” although the adjustments will not be completed until the end of October.

The bank said credit ratings were of “significant concern to customers” and is continuing to work with credit reference agencies to ensure no customer's rating is permanently affected. Customer with concerns should contact the bank to arrange a free credit report.

Customers of other banks affected by the crisis will also have fees and charges refunded but must contact their banks for out-of-pocket expenses.

The bank’s chief executive, Jim Brown, apologised again to customers and said he recognised the bank has “work to do to restore our customers’ trust”. He said this was “the first step in that direction.”

Mr Jewell said the out-of-pocket expenses plus an additional 20 per cent was “a help” but said the limit “is most unusual”. He also said the bank was “making it unacceptably difficult for those who are not its customers to get resolution. Those people have a lot of work to do, and I am very disappointed that Ulster Bank is not recognising that”.

Mr McGrath said the package was “fair and reasonable” but said it would have to be “implemented efficiently” and he called on the bank not to “unnecessarily contest claims for out of pocket expenses”.

The Central Bank said Ulster Bank was required to provide “clear and timely information” to customers on compensation plan, and encouraged clients to contact the bank once they received written notification of the plan.

“While Ulster Bank is required to reimburse and make good any actual losses suffered by customers, the level of any payment for inconvenience suffered is not subject to the Central Bank’s regulatory standards or approval,” Bernard Sheridan, director of consumer protection, said. “This is a commercial decision for Ulster Bank.”

Customers who are not satisfied with the arrangements can refer their complaint to the Financial Services Ombudsman, he said. The Central Bank said investigations into the technical failure and how it was dealt with are ongoing.

The Irish Payment Services Organisation (Ipso) said customers affected by the problem at Ulster Bank should in the first instance speak to their own financial institution. If the situation was complicated, it may need to be assessed on a case-by-case basis, but the relevant financial institutions had pledged to work together to do this as quickly as possible.

It advised customers affected by the Ulster Bank issue to keep a note and any documentary proof of the impact on them, in case it was required. If they were not satisfied with the solutions proposed by their financial institution, they should ask to follow its formal complaints procedure.

“Failing that you can raise a complaint with the Financial Services Ombudsman.”