For the past week parents have been reporting problems accessing the Childcare Services hub run by HM Revenue & Customs (HMRC), which went live a month ago and allows families to sign up for and manage their childcare benefits, including tax-free childcare and the 30 hours of free childcare entitlement, which comes into effect in September.
Some parents have said the technical problems have left them unable to pay childcare providers.
Pre-school Learning Alliance chief executive Neil Leitch said: "It is simply unacceptable for parents to be experiencing difficulties accessing the Childcare Services hub so soon after its launch."
"We had thought that the delay of the launch of the tax-free childcare scheme would have given the government adequate opportunity to iron out any glitches with the registration and online account system, however, it is becoming apparent that far more work is needed before the hub can be considered fit for purpose.
"Of course, the knock-on effect of the problems parents are encountering will be that payments to providers are delayed. This is a slap in the face for the sector, as many providers are already struggling to cover their costs due to persistent underfunding and rising business rates.
Purnima Tanuku, chief executive of the National Day Nurseries Association, said it is the latest technical problem to blight the hub.
"An HMRC representative first made us aware of initial teething troubles with this website at our member event in March," she said.
"At that point, nurseries were unable to register. We understand that particular problem has now been resolved, so this is a second set of issues relating to the website.
"The government has promised this support for parents, so must resolve these technical issues as a priority. Both parents and providers need confidence that this system will work. This is just adding to the many burdens that childcare providers are currently having to bear."
The tax-free childcare scheme launched on 28 April and involves the government topping up £2 for every £8 that parents, of children under the age of two, pay into it.
By the end of 2017 the scheme will be available to all eligible parents of children under the age of 12, or under 17 if disabled.
The scheme is available to working parents who earn at least £120 a week and less than £100,000 a year.
An HMRC spokesman said: "While the vast majority of customers successfully apply without any issues, we are aware that some parents and childcare providers have been experiencing technical difficulties with the childcare service and we apologise to them.
"We investigate and act on these issues as soon as they're brought to our attention and anyone experiencing problems can call our dedicated helpline on 0300 123 4097."