Starling bank has raised a further £40 million from existing investors JTC and Merian Chrysalis Investment Company, bringing the total raised this year to £100 million.
Starling now has more than 1.4 million current accounts, including 155,000 business accounts, since launching its banking app in May 2017. Its deposit base has more than doubled in the last six months and it now holds more than £2.4 billion on deposit.
The new round of funding will be used to spur its assualt on the small business arena, where the digital challenger holds a 2.6% share of the UK's SME banking market. It has almost £500 million of SME lending on its balance sheet, with further commitments raising the total to almost £1 billion.
As an app-based bank, Starling says it has seen robust customer acquisition since the lockdown, especially in the business account channel, where daily sign-ups have accelerated from the start of the year.
Anne Boden, founder and chief executive of Starling Bank, says: “This additional funding from our existing investors demonstrates their commitment both to Starling and to our small business and personal customers who need our support now more than ever.”
In January, Boden forecast a first full year in profit by the end of 2020 leading to a possible float in 2021. But with the Covid-19 pandemic pummeling the tech startup scene, Boden has recast those forecasts, suggesting that a move into the black will not happen until some time in 2021, with a subsequent delay to any IPO.
Since its launch in 2014, the bank has raised £363 million.