Starling Bank is set to cut 130 jobs as the digital lender increases investment in artificial intelligence in a bid to reduce costs and improve efficiency.
The online bank confirmed that around 3% of its workforce will be affected as part of a restructuring programme aimed at streamlining its banking and technology operations.
The London-based fintech, which employs more than 4,000 people, said the changes are designed to remove duplicated roles while accelerating investment in AI capabilities.
A spokesperson for the bank said its “competitive edge over legacy banks” comes from its “agility” and “ability to test, launch, learn and reorganise at pace”.
The bank added: “While we are continuing to hire tech and AI engineers, we recently told colleagues that we are changing parts of our banking team structure to simplify how we operate, reduce instances of duplication, and drive further product delivery at pace.”
“We have begun a period of consultation with colleagues whose roles may be affected by these changes.”
The job cuts come as Starling faces mounting pressure on profitability. The lender reported a 6% decline in revenue to £887 million in the year ending March, while pre-tax profits fell 3% to £217 million.
The bank said lower earnings were partly linked to continued investment in Engine, its digital banking software platform.
Founded in 2014 by former Royal Bank of Scotland executive Anne Boden, Starling emerged alongside rivals Monzo and Revolut as part of a new generation of challenger banks aiming to disrupt traditional banking in the UK.
Starling now serves 6.2 million customers, although its international expansion efforts have been more limited. The bank abandoned plans to secure a European banking licence in 2022.
Its growth trajectory has also been affected by regulatory scrutiny. In 2021, the UK’s financial watchdog imposed restrictions on Starling over concerns about financial crime controls, preventing it from opening accounts for certain high-risk customers.
The Financial Conduct Authority later criticised the lender’s compliance measures, describing them as “shockingly lax” and fined the bank £29 million in 2024.
Despite recent challenges, speculation continues over a potential stock market listing. Earlier this year, Starling chief executive Raman Bhatia said there were no immediate plans for an initial public offering but noted that he could “see this business as a plc … in a near-term window”.