The digital bank Starling has managed to grow revenues to £97.6 million from £14 million in the previous period.
The key to the success of Starling were business accounts as lending remained the driver of mentioned growth. Starling has 374,000 business accounts, up from 180,000 last year.
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This has pushed the bank’s total accounts to 2.1m with a lending of £2.2bn.
“Starling, whose backers include Goldman Sachs, is pursuing a more traditional banking business model than some fintech peers such as Monzo and Revolut, focusing on building a substantial lending business from its own balance sheet.” Financial Times reported.
Starling also reported a net loss of £23m for the 16 previous months ending March 31, compared with a £52m loss in the 12 months to November 2019.
“They have seven times the customer numbers we have and only 60% of the deposits,” CEO Starling, Anne Boden said. According to Starling, personal banking customers also hold an average balance of £2,000 with the digital bank.
Starling Bank also raised £272 million in a Series D funding round led by Fidelity Management & Research Company.
Goldman Sachs Growth Equity then invested £50 million. This makes the total raised in the investment round to £322million. Before the investment, Starling was valued at £1.1billion.
Revolut has been recently valued at $33bn after a new investment announced last week.
Boden said: “We never sought customers just for the sake of having customers . . . We have customers who are using us for real banking, and that shows in the balances we have in the accounts and the overall deposits we have.”
Anne Boden described Revolut’s bumper valuation as “interesting”, but Starling would focus on making sure it “gets to the right number when we float, and doing that on a very solid footing”.
She added the company aimed to IPO in late 2022 or early 2023, but said that “the important thing is we’re going to do it in our time. We’re not going to be forced to do it because it’s fashionable at the moment.”