Challenger banks are slowly changing the financial ecosystem providing users financial services in the comfort of their mobile phones – just a tap away. One of these banks is Starling Bank.
The bank has a decent reputation in the personal finance space as it was one of the first to offer instant transfers between personal current accounts via their mobile app. But that’s not the only impressive feature of the UK-based bank.
In this Starling Bank review, we’ll take a look at the bank’s features, accounts, pros, and cons.
What is Starling Bank?
Starling Bank is a UK-based online bank that provides current accounts, savings, and loans. The bank’s services are available through the Starling iPhone app or on the Starling website.
According to the company, the bank’s name was inspired by the starling bird, which is fast, flexible, innovative, and beautiful.
A challenger bank is an institution that has been created to compete with established banks in the same country. Starling Bank is a challenger bank that aims to “make banking fair and simple for everyone.”
It was founded by Anne Boden, who used to be CEO of New Star Asset Management. Starling also employs former retail bankers from HSBC, Santander, and RBS, among others. The bank is backed by venture capital firm MMC Ventures as well as investment fund Third Security, which focuses on fintech startups.
Starling’s app was featured in Apple’s launch of its new mobile operating system, iOS 9, in September 2015. So, it’s safe to say that the bank is renowned and has the potential to become a favorite among the British population.
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Starling Bank Accounts
Starling Bank has a number of personal and business accounts for individuals, kids, and couples, users, or business partners.
Starling Current Account
Starling Bank’s current account is a regular checking account that has been regarded as the best existing account by the British Bank Awards. Setting up the account is pretty simple as everything is done online.
The current account offers protection of up to £85,000 for your money under the Financial Services Compensation Scheme. Here are some other notable features of this bank account:
- Go Digital: Since the bank account is literally on your phone, everything from money transfer to money management is online.
- Free Account: You can create a free Starling Current Account right now from your phone. It only takes a few minutes.
- Notifications: The mobile app allows you to save your money as you want. Plus, you get notifications for money transfers and other transactions. Additionally, Starling Bank has smart tools for money management and budgeting.
- 24/7 Support: Owing to an all-human support system, Starling Bank’s customer support team is able to resolve queries efficiently, irrespective of the time of the day.
- Categorized Spending Insights: In the Starling app, you can see your spending under specific categories. It helps make budgeting easier.
- Spaces: Starling’s Spaces is a saving feature that lets you put money in ‘piggy banks’ for different goals. You can also set automatic rounding up of transactions so that the change can be saved into these Spaces.
- Set IOUs: With the current account, payment has become much simpler. You can send a payment link to someone or split the bill with your buddies – all it takes is a tap.
On top of that, you can use an ATM for free even when you’re overseas since there are no extra charges for that. If your card is stolen or lost, you can instantly lock it from the app.
It seems as if Starling has tried to give traditional banks real competition since their current account has some impressive features. These include:
- Cash Withdrawal: You can withdraw cash from one of the 11,500 on-network ATMs and deposit cash at the Post Office’s branches.
- Earn Interest: Moreover, Starling lets you earn 0.05% AER if your balance is up to £85,000.
- Cheque Deposit: Depositing your cheques is pretty simple as you just have to scan them using your camera.
- Additional Accounts: Starling lets you add another account for just £2 per month. So, if you want multiple accounts for work and personal use, you can avail this service at a minimal cost.
- Eco-friendly: Starling’s Mastercard is made with recycled plastic and happens to be one of the first of its kind in the country.
How to Open?
Opening a current account with Starling Bank is pretty simple. You just need the following things:
- Five minutes
- A phone with internet
- A valid photo ID (driving license or passport)
Starling Joint Account
Starling’s joint account is a good option for couples or business partners. Along with this account, the bank also lets you get a Connected Card on all accounts. It’s basically an extra card you give to someone, allowing them to use the funds in your bank account.
The joint account helps user in the following ways:
- Keep Tabs On Spending: Since you get instant notifications, you can always stay up to date with the payments your partner has already made and the ones that are still pending.
- Monthly Insights: You can also see monthly spending insights and determine if you want to make any changes in your spending habits.
- Goals: Starling Bank’s Goals is a saving feature that lets you save together for a new vacuum cleaner or a trip to Italy.
Creating a joint account with Starling is much easier than doing it in a traditional bank. All you have to do is search for the other person’s phone app. If they’re nearby, such as on the same couch or bed as you, the joint account scanner will find them quickly.
Then, they just have to accept your request to set up a joint account, and you’re good to go.
Starling Kite Account
Starling Kite is a bank account for your little ones, training them on money management at an earlier stage in their life. The account is for children aged 6 to 16 and connects seamlessly to a parent’s current account, giving you control and visibility into your child’s spending.
Here are some features of this bank account:
- Easy Control: You can set up a Kite account for your kid easily. After that, it’s simple to send them money or get notifications when they spend money in their account. Plus, you can set up automatic transfers, sending them money regularly.
- Financial Training: Since the child also gets an app, they can track their transactions and learn about money management early in the day.
- Budget-friendly: At just £2 a month, the account is pretty pocket-friendly. Moreover, you do not have to pay any ATM withdrawal or transfer fees.
- Fully Licensed: Even if the account is for your kid, you’re primarily in control since you’re the account holder. Therefore, any money in the Kite account is FSCS-protected up to up to £85,000.
How to Open?
If you already have a Starling Bank current account, you just have to follow these steps to open an account:
- Go to the app and tap Spaces.
- Select Child Space and then just follow the steps on the screen.
Starling Teen Account
Starling Bank also offers a teen account that is perfect for teenagers who might be doing odd jobs or gigs and want to learn the skill of money management. The account comes with the following features:
- 24/7 customer support
- 0.05% AER on balances up to £85,000
- Mastercard debit card
- An app for instant banking
- Samsung Pay, Apple Pay, and Google Pay
- Spending insights
- Instant payment notifications
- Nearby Payments – send money instantly to buddies sitting next to you without even getting their bank details.
- Lock the card from your app
- Protection as per the Financial Services Compensation Scheme
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Along with bank accounts, Starling also offers lending options, such as Overdraft personal lending and business loans.
Starling’s personal lending is a good option for people who might be feeling a financial burn due to overdraft. Here are some provisions of this feature:
- You can apply for it through the app in seconds.
- The app lets you see how much it will cost you.
- Use the app’s overdraft slider to adjust the limit.
- Starling reminds you of upcoming payments to ensure you never miss them.
Starling Bank’s Recovery Loan Scheme is aimed at helping Starling Bank customers who have been unfortunate enough to be hit by unanticipated expenses.
The scheme allows Starling Bank consumers to borrow up to £2,500 with an 18-month loan term alongside a competitively priced interest rate.
Starling Bank’s Recovery Loan Scheme combines affordability and flexibility for unexpected expenditure through its 30-day free credit option.
The bank’s “no typical bank charges” policy means that the free credit period will not incur any of the bank charges typically associated with overdrafts or credit cards, such as additional interest fees or outstanding balance fees.
Along with bank accounts and loans, Starling Bank also has additional services such as the ones discussed below.
Sending Money Abroad
Starling Bank also lets you set money internationally with ease. The bank’s international payments are powered by Transferwise, the online money transfer service that is changing the way people move money around the world.
Starling customers can now transfer Starling Sterling to a Starling account held in a currency other than pounds at interbank rates, with no hidden charges and minimal FX conversion fees – something not offered by any other UK bank.
Like some other banks, Starling automatically categorizes the money you spend into different sections, like entertainment, commute, etc. Then, the bank uses this information to generate a Starling Spend Score.
The Starling Spend score is a number from 0-100, which represents your spending habits, ensuring Starling works for you and helps to meet your financial goals.
Who is Starling Bank For?
Starling Bank is ideal for people who need a personal and business bank account that can work across all their devices. The bank aims to draw in students, the younger generation, and those comfortable with using technology they are already familiar with (e.g., smartphones).
Since the bank lets users hold Euros and transfer them without a fee, its accounts may also be helpful for frequent travelers and European students.
Starling also provides business banking solutions for freelancers, small businesses, and entrepreneurs who may not have access to traditional financing methods such as overdrafts or business loans.
Starling intends to fill this gap by giving businesses real-time working capital in the form of fast digital payments, helping them increase their sales volumes and cash flow.
The bank also boasts a contactless Mastercard® debit card which can be used at any retailer. So, it’s suitable for people who prefer card payments over cash.
Pros of Starling Bank
Here are the pros of this bank:
- In-app features to apply for business and personal loans
- Ideal for sending money abroad
- Joint and teen accounts are available
- Users earn interest on current accounts
- App-based banking made more manageable with money management tools
- 24/7 live chat customer support
Cons of Starling Bank
Although it’s a seemingly perfect bank, here are some of its cons:
- Does not have a physical branch
- Cheques take up to a week to be deposited into your account balance
- Users can only make cash deposits to their accounts at Post Office branches
Starling Bank’s customer reviews are overwhelmingly positive, as you can see on the bank’s website and third-party sites like TrustPilot. Along with the bank’s excessive number of features, the positive response also stems from its human customer support that’s available around the clock.
To sum up, Starling Bank is a newer entrant to the UK banking market that can compete with the “big boys” via its unique take on what existing customers want and how new ones are acquired. The bank is digital-first in everything it does, focusing on building its strength in customer service through human interactions.
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However, it may not be a suitable option for people who prefer physical branches and would like to have more options to deposit cash into their accounts. Apart from these shortcomings, Starling Bank seems to be impressively perfect for today’s digital users.