Starling - Third year of profitable growth - Annual Report (2024)


If they ever get around to an IPO, I think I’d be quite tempted. Another strong report, that.


Coop and VM has shown than scale is required in retail banking.
Starling (or Monzo) are not niche enough buck that trend.

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I don’t think that’s an entirely fair comparison. Co-op and Virgin Money are legacy institutions (with the overhead that entails --branches, dated internal processes etc), so they need to scale just to keep the lights on. Starling and Monzo don’t have any of that.

The hard part for any app-based bank is getting people to trust you enough to keep a lot of money on your platform. Starling appears to be doing a better job of that, without having to resort to packaged accounts and BNPL.

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Reckon you’re right, and they achieve it without unnecessary fuss.


Kind of begs the question: What is necessary fuss?

Now you pose the question, maybe no fuss is necessary.

Palaver? :grin:


I wouldn’t classify as either Co-op or VM as having a decent branch network akin plus having an app doesn’t mean you don’t have other (direct) channels such as phone or web based banking.

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Can you explain this further?

Nah, they recklessly resorted to the BBLS instead. And they do dabble in the package-esque freemium model with some features too.

Given where interest rates are now (a strong criticism/attribution of Monzo reaching profitability this year from certain folks) it’s a very weak report IMO, having now taken the time to assimilate it in full. Take the bounce back loans off the table, and I’m not sure what they have? Mortgages, maybe, but they’re a very shallow ceiling. A quick glance at Atom demonstrates that.

I feel like they’ve squandered the potential of the BaaS platform too by interpretation. It’s by far the most compelling aspect of the business and it seems like they’ve failed to properly capitalise on it, and now it may be too late as there is some new fierce, and in my view better, competition in this space. Again, stagnant is a fitting word.

Relative to last year, it’s pretty stagnant and suggests to me that growth has peaked for them. Only fewer than 600k new customers for that year, hence discussing active customers instead (which they don’t share the methodology on, and can be tweaked as they see fit to make it look better). And even that is only up 500k. Growth is trending downward in every metric, which isn’t good (though is still growth, for now).

Banks kinda need to have a broader product offering for stability and security. Including, it seems, the branch-less fintech ones. The lower class overhead promise has yet to be fulfilled by any fintech as far as I can tell. At least not in the nature that was promised by leaders, including Anne, at one of the Expos prior to them launching. Current accounts, with interest rates higher than the BoE base rate and still being profitable on a per customer basis from just the simple standard current account. The overheads are lower. They should be. But they’re not that much lower in reality vs theory, it turns out.

TL;DR: reading beyond the headline figures, which themselves aren’t terribly impressive on the back of 2023’s report, I find last year’s performance to be stagnant and incredibly underwhelming, though unsurprising. Starling are uninspired and the report demonstrates that. A load of fluff.

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Starling Bank have now stopped offering overdrafts increases.

Haven’t seen any statement to that effect, but overdrafts are invariably subject to status.

I can still apply for one, but I don’t want one.

Like removing the ability to open additional accounts it’s been done quietly with a note in the FAQs.