Raman Bhatia, new CEO of Starling. Bhatia joined from OVO Energy Ltd., where he was CEO.
Zed Jameson | Bloomberg | Getty Images
AMSTERDAM – Digital bank Starling will not reapply for a European Union banking license and will instead pursue international expansion through its software business, its new CEO said, in a different approach to overseas growth from some of its rivals.
Starling is one of the so-called “neobanks” in the UK – purely digital banks that typically have no branches. Launched in 2014, it has signed up 4 million customers and was last officially valued at 2.5 billion pounds ($3.2 billion).
The digital bank powered by Goldman Sachstraditionally offers banking services such as checking accounts and more recently also loans. Starling’s customers are primarily located in the United Kingdom. The company wanted to expand abroad by applying for an Irish banking license, which would have given the bank access to the European Union market. Starling withdrew that motion in 2022.
Raman Bhatia outlined the company’s international expansion plans on Wednesday in his first public comments since being named CEO in March, taking over from founder Anne Boden.
Bhatia said the company does not plan to reapply for the EU banking license to venture into new countries. Instead, international expansion is being driven by Engine, a software platform that Starling sells to other companies so they can build their own digital banks.
“I’m very optimistic about this approach around the internationalization of what’s best about Starling, the proprietary technology versus market after market, idiosyncratic regulatory regimes, capital requirements, and building trust and brand expansion, which proves to be no plan is,” Bhatia said during a fireside chat at the Money 2020 conference hosted by CNBC.
He described the opportunities in countries like Thailand and the Middle East as “immense.”
Engine is a unique model among neobanks, which tend to deal with consumer-focused apps and services. Starling is betting on being able to sell the technology to other banks.
Salt Bank in Romania and AMP in Australia are Starling’s first engine customers.
Bhatia said he would like to “double down” on the engine strategy and gain market share in the enterprise software space.
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2024-06-05 07:08:38
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