Starling Bank, the U.K.-based challenger bank founded by banking veteran Anne Boden, has raised an additional £40 million in funding, TechCrunch has learned.
The round is led by existing backers Harry McPike’s JTC and Merian Chrysalis Investment Company Limited, and adds to the £60 million raised in February this year.
Now boasting 1.4 million accounts, including 155,000 business accounts, Starling Bank has raised a total of £363 million since its launch in 2014. Noteworthy, I’m told that its deposit base has doubled in the last six months and it now holds more than £2.4 billion in deposits.
“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,” said Starling’s Anne Boden in a statement confirming the fundraise.
I understand the new funding will enable the bank to continue investing in growth, and, more specifically, to provide “much-needed support to small business customers who have been hit by the coronavirus emergency.”
This has seen it collaborate with the U.K. government to increase lending to SMEs as part of the country’s various coronavirus crisis business support packages, including £300 million under the government-backed Coronavirus Business Interruption Loan Scheme (CBILS) and direct to its customers under its own CBIL and Bounce Back Loan Schemes.
To that end, since launching SME accounts in March 2018 and securing £100 million in state aid via the Capability and Innovation Fund (CIF), business banking has become a big bet for Starling. It appears to be starting to pay off, too, with the bank now claiming to hold a 2.6% share of the U.K.’s SME banking market, with almost £500 million of SME lending currently on its balance sheet.