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Starling raises £75mln as digital banks up their challenge

The bank raised £75mln led by Merian Global Investors, formerly known as Old Mutual, which chipped in £60mln
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Starling is one the UK's Fintech stars

Starling, one of big three UK digital bank start-ups, has followed its two main rivals and completed a major funding round.

The bank raised £75mln led by Merian Global Investors, formerly known as Old Mutual, which chipped in £60mln.

Forefront of digital banking space​

Existing shareholder Harald McPike stumped up the remaining £15mln.

Starling is battling with two other start-ups Monzo and Revolut to establish itself at the forefront of the digital banking space.

In October, Monzo reached “unicorn” status, a term used to describe a privately-held start-up company valued at more than US$1bn, after raising £85mln through venture capital investors Accel Partners and General Catalyst.

In December, it topped that up with a further £20mln through a crowdfunding event which saw more than 36,000 customers invest up to £2,000 each.

Revolut is said to be in talks with Japan’s Softbank over a US$500mln investment.

Monzo and Revolut already have over one million customers, a total Starling says it will achieve at the end of this year.

It has about 460,000 consumer accounts and 30,000 business accounts currently.

The bank also runs a fast-growing white label banking service that has 20 institutional clients and recently launched a euro account that allows UK residents to hold, send and receive euros for free.

The bank is also said to be applying for a licence in Ireland.

Anne Boden, chief executive and who founded the bank in 2014, said: "Building our platform and launching in the UK to provide genuine choice to retail, SME and Banking-as-a-Service customers was just the first step.

“Our ambition is to use our technology to build a next-generation global, digital banking platform, starting with our launch across Europe this year."

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