Starling Bank is to axe 130 jobs – 3% of its workforce – as the digital lender steps up investment in artificial intelligence to drive down costs, after reporting a drop in revenue and profit. The London-based fintech told staff this week that it would restructure its banking and tech operations, cutting “duplicate” roles while continuing to hire tech and AI engineers.
The bank, which employs more than 4,000 people, has been under pressure. In the year to the end of March, revenue fell 6% to £887m and pre-tax profit dropped 3% to £217m, partly due to investments in its digital banking software, Engine. The restructuring, it said, was necessary to simplify how it operates and “drive further product delivery at pace”.
“Starling Bank to cut 130 jobs and boost AI investment after 6% revenue drop.”
“While we are continuing to hire tech and AI engineers, we recently told colleagues that we are changing parts of our banking team structure,” the bank said. “We have begun a period of consultation with colleagues whose roles may be affected by these changes.”
Founded in 2014 by former Royal Bank of Scotland executive Anne Boden, Starling was part of a trio of online-only neo-banks – alongside Revolut and Monzo – that emerged to disrupt traditional banking. It now has 6.2 million customers, the majority in the UK. But its growth has faltered. In 2022, it abandoned plans for a European banking licence, and in 2021 the Financial Conduct Authority imposed restrictions on it over poor financial crime controls. Last year, the regulator fined it £29m, describing its controls as “shockingly lax” and saying they “left the financial system wide open to criminals”.
Despite the setbacks, there has long been speculation that Starling could list on the stock market. In January, the bank’s chief executive, Raman Bhatia, told the Sunday Times that while there were no “firm plans”, he could “see this bus coming down the road”. The latest cuts and AI push are seen as an attempt to streamline operations ahead of an influx of new projects, as the bank seeks to regain its competitive edge.