Digital Banking

Staking Out Territory In An Increasingly Crowded Digital Field

Can being first to market with innovations help a banking startup standout in the ever-expanding sea of digital options? In the latest PYMNTS Digital Banking Tracker™, Julian Sawyer, COO of Starling Bank, a U.K.-based startup, explains how the company works to use technology and partnerships with popular providers to attract customers and power its European expansion plans. Find that, plus the latest headlines from around the space and rankings of more than 200 digital banking providers, inside the new Tracker.

For consumers looking for mobile banking options, there’s no shortage of solutions available in digital download stores alone. But, in such a jam-packed space, how can a startup stand out from the crowd?

For U.K.-based, startup, digital and mobile financial firm Starling Bank, the answer has often involved trying to stay ahead in the crowded digital banking race. In a recent interview, COO Julian Sawyer told PYMNTS the bank has been doing just that since it was founded in 2016, all by using its technologist DNA to debut new digital features and services ahead of its competition.

“It goes back to what Starling is,” Sawyer said. “We’re a digital technology company that happens to be doing banking and payments, so we want to have technology leading the way for us. At the end of the day, we’re good at payments and we’re good at technology, and we want to combine those efforts so we can kind of lead the pack.”

The company is also eager to partner with technology providers that can complement its skillset and help it build on what it does best, he added.

In April, Starling Bank announced it had become the first digital-only bank in the U.K. to partner with Pay by Bank, a new app designed to make online and mobile payments more secure and convenient for customers. And, by striking a new partnership with Apple in July, Starling Bank became the first financial institution of any kind in the U.K. to offer the ability to setup and authenticate Apple Pay transactions within its own mobile app.

As a result, the bank has added several thousand customers since it opened its digital doors in July 2016, and continues to on-board more than 100 new customers each day. Now, the company is looking to use those partnerships — and other features and capabilities — to appeal to a new customer base, beyond its London headquarters, by expanding business throughout Europe.

Pushing forward on partnerships 

Sawyer said the company’s integrations with both Pay by Bank and Apple were designed to help it stand out in a competitive digital banking field — and attract customers looking to use a digital- and mobile-first banking option.

Starling Bank also debuted a new kind of integration this year with the launch of Marketplace, a new ecosystem of financial products accessible through Starling’s app. It offers Starling customers access to products and features from other FinTech providers via an integration with Open Banking- and PSD2-compliant APIs.

Marketplace went live in mid-September, partnering with Flux as its first third-party FinTech to offer software in the Starling app. The integration allows customers to view receipts for transactions in the Starling app in real-time. It also enables customers to earn loyalty points at participating restaurant and merchant locations.

In addition, the company has announced partnerships that will result in future integrations available in the Starling Marketplace, including agreements with investment app Moneybox, cashback app Tail and money transfer app TransferWise.

“These partnerships are about identifying what we do best — which is offering a checking account product and helping customers sort through their finances — and focusing on that while still offering customers other services,” Sawyer explained.

Making payments faster

Starling Bank has been eager to debut features, built in-house, that make use of new and evolving technologies as they reach the market. These include the company’s very own Faster Payments scheme, known as Starling Payment Services, which launched in May of this year. According to Sawyer, it is the first (and still the only) direct access to the Faster Payments framework in the U.K.

The feature enables customers to send and receive money instantly online or through mobile, in much the same way consumers send money via Venmo and other P2P transaction apps.

By conducting transactions within Starling Bank’s app, the company’s authentication architecture remains in place, offering consumers a more secure experience, Sawyer noted. Working to offer still-evolving capabilities like Faster Payments is part of how the company has attempted to differentiate itself from competitors.

Starling Bank also opened the service to other FinTechs via an API, which debuted along with the Starling Payment Service. Sawyer said the API gives more small banks and financial institutions (FIs) the ability to perform P2P transfers for their customers, who are increasingly expecting these features from digital offerings.

“We believe that payments should be open, connected and always done in real-time,” he said.

The service currently only makes transfers in British pounds, but the company plans to add the ability to make transfers in Euros later this year.

Eye on European expansion 

But the plans to add the Euro to Starling Payment Services are only part of Starling Bank’s ambitions on the wider continent. The company recently announced it would undertake a European expansion effort to increase its presence in the region.

Those efforts began in Ireland, after the bank received its cross-border passport — a widely-used tool for financial firms hoping to be approved by local regulators in new markets — to expand into the country.

Since branching into the Emerald Isle in June 2017, Sawyer said the company has on-boarded numerous Irish customers as part of an expansion pilot program. Next up, the company has designs on expanding to mainland Europe, including many countries in the European Economic Area and European Union.

“The nice part about offering a digital product is that it isn’t constrained by many of the traditional borders and limits that other financial service products and firms are bound by,” Sawyer said.

. . . . . . . . . . . . . . . . 

TO DOWNLOAD THE SEPTEMBER EDITION OF THE PYMNTS DIGITAL BANKING TRACKER™, CLICK THE BUTTON BELOW. 

About the Tracker

The PYMNTS Digital Banking Tracker™ brings you the latest news, research and expert commentary from the FinTech and consumer banking space, along with the rankings of over 200 companies serving or powering the digital banking sector.

——————————–

Latest Insights: 

The Payments 2022 Study: Building A High-Performance Payments Team For Fraud Detection, a PYMNTS collaboration with Stripe, examines how digital platforms of all sectors and sizes plan to develop their anti-fraud teams as part of their their broader growth and development strategies. Drawing from an extensive survey from approximately 250 payments heads at digital platforms in the U.S. and abroad, our study analyzes how poor anti-fraud capabilities can harm platforms’ long-term growth strategies, and how they can build high-performing teams to tackle these challenges.

TRENDING RIGHT NOW

To Top