Raman Bhatia, new CEO of Starling. Bhatia has retired from OVO Energy Ltd., where he was CEO.
Zed Jameson | Bloomberg | Getty Images
AMSTERDAM – Digital bank Starling will not reapply for a European Union banking license and will instead seek international expansion through its software business, its new chief executive said, differing from some of its rivals in its approach to expansion overseas.
Starling is one of the UK’s so-called “neobanks” – banks that operate digitally only and typically have no branches. It launched in 2014, attracted 4 million customers and was last officially valued at £2.5 billion ($3.2 billion).
Digital bank supported Goldman Sachs, offers traditional banking services such as checking accounts and, more recently, lending. Starling’s customers are primarily based in the UK. The company sought to expand its activities overseas by applying for an Irish banking license, which would give the bank access to the European Union market. Starling withdrew this application in 2022.
Raman Bhatia outlined the company’s international expansion plans on Wednesday, in his first public appearance since being named chief executive in March, succeeding founder Anna Boden.
Bhatia said the company has no plans to reapply for an EU banking license to expand into new countries. Instead, international expansion will be driven by Engine, a software platform that Starling sells to other companies so they can build their own digital banks.
“I am very optimistic about this approach to internationalize what is best about Starling, proprietary technology versus each market, idiosyncratic regulatory regime, capital requirements, and building trust and brand extension, which has not been proven for any plan.” , Bhatia said. during a fireside chat at the Money 2020 conference moderated by CNBC.
He called the opportunities in places like Thailand and the Middle East “huge.”
Engine is a unique model among neobanks, which tend to focus on consumer-facing applications and services. Starling is betting he can sell the technology to other banks.
Salt Bank in Romania and AMP in Australia are Starling Engine’s first customers.
Bhatia said he would like to “double down” on Engine’s strategy and capture market share in enterprise software.