Starling Bank is a UK-based challenger bank founded by Anne Boden and it has just raised another £40 million in the latest funding round from its existing investors.
The round was led by existing backers Harry McPike’s JTC and Merian Chrysalis Investment Company Limited, making the raised funding in 2020 to a total of £100 million (Starling has raised £60 million this February).
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At this moment, Starling has more than 1.4 million active accounts, including 155,000 business accounts. The deposit base has doubled in the last six months and it now holds more than £2.4 billion in deposits.
This fresh capital will go towards the company-wide growth strategy, and its “much-needed support to small business customers who have been hit by the coronavirus emergency,” a bank spokesperson told TechCrunch.
“This additional funding from our existing investors demonstrates their commitment both to Starling and to our small business and personal customers who need our support now more than ever,” said CEO Anne Boden in a statement confirming the raise.
Starling claims to be the fastest-growing bank for small and medium-sized enterprises (SMEs) in Europe. At this point it holds a 2.6% share of the UK’s SME banking market. It has almost £500 million of SME lending on its balance sheet, with further commitments raising the total to almost £1 billion.
But the COVID crisis is clearly disrupting long-term growth plans all over the market. Anne Boden told Wired this week that though it was planning to reach profitability in 2020, this timeline has been pushed back to 2021, with a consequent delay to any initial public offering (IPO) which was planned for 2022.
