Starling Bank, the U.K.-based digital bank, has curtailed its international expansion plans, halting its attempt to win a banking license in Europe.
According to media reports Monday (July 18), Starling has informed employees it had withdrawn its application for a license from the Irish central bank and will instead turn its attention to promoting its software-as-a-service product — designed to help banks with their digital transformation strategies — and move into new areas of lending.
The company says it hasn’t given up on expanding into Europe, but that it now sees that route via software deals with other lenders.
“Ultimately, we felt that an Irish subsidiary would not deliver the added value we are seeking,” CEO Anne Boden said in the memo, per reports.
“We’ll now be focusing on taking our software to banks around the globe through our Software as a Service subsidiary, Engine, and by expanding our lending across a range of asset classes, including through targeted M&A activity,” she added.
Read more: Why Starling Bank CEO Said No to Crypto
Last month, Boden said the bank has steered away from digital assets, and has in fact focused on protecting unwitting customers from rising scam risks, especially in places where crypto wallets are directly tied to real-time payment schemes.
“We’re in a very dangerous phase,” said Boden during a session at the Money2020 Europe conference in Amsterdam. “We’re spending far more of our time protecting customers from [crypto] scammers than we are trying to promote crypto.”
She added that European banks need to put into place much tougher know your customer (KYC), anti-money laundering (AML) and onboarding procedures to stem the growing trend.
“Our AML and our onboarding processes are as good as the weakest link, and I think some of these organizations are the weakest link,” Boden argued.
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