Member Article

Starling Bank becomes first mobile-only bank to join Current Account Switch service

Starling Bank, the challenger bank which recently launched into beta, has announced that it has joined the Current Account Switch service, meaning new users will be able to easily transfer their everyday bank account functions to Starling once it fully launches.

The move sees the mobile-only bank join over 50 mainstream and high-street banks on the service, which launched three and a half years ago to streamline and simplify the process for consumers looking to switch their current accounts.

Launched to encourage competition amongst current account providers for individuals and small businesses, the service has now facilitated over 3m switches since its launch.

With Starling becoming the latest brand to partner with the service, it now means that those looking to open current accounts with the new bank will be able to easily migrate their account functions, including overdraft and direct debit, from their current provider.

Following the announcement, Julian Sawyer, Chief Operating Officer at Starling Bank, said: “We are proud to be announcing our partnership with the Current Account Switch Service today. Many people in the banking industry talk about ‘customer inertia’.

“But at Starling, the customer is at the heart of everything we do. And we have to ask why people switch banks so little. One of the main issues is the fact that moving banks can be a time-consuming, stressful experience - so much so that the very idea of switching is hard to contemplate.

“The Current Account Switch Service’s seven-day process (and Guarantee), as well as our Starling real-time tracker help take that hassle away.”

Anne Pieckielon, Director of Product and Strategy at Bacs which runs the service added: “We’re pleased this exciting challenger bank is now on board, adding to the breadth of options available to individual customers and businesses that want to take advantage of the simplicity of our service to switch their current account.”

Why it’s interesting

In becoming the first mobile-only bank to join the switching service, Starling has laid down a significant marker for its ambitions to transcend the cloistered realm of digital curiosity and challenge the mainstream account providers in the coming years.

There is a debate to be had about whether the new generation of financial and banking upstarts should look to either complement the services provided by the big-name banks, or set their ambitions higher and strive to take a chomp out of their market share.

As Julian Sawyer explained, control and choice are one of the core benefits of the new wave of challenger banks and, perhaps, their main competitive advantage over the sluggish incumbent banking giants.

Which means that making it as simple as possible for consumers to integrate new services and apps into their daily routines is just as important as offering innovative features and fully formed products and services.

As such, the switching service and the new challengers are essentially striving for the same thing, promoting competition and choice within a traditionally static industry, meaning more neo banks will inevitably follow the likes of Starling and Metro Bank in joining the scheme.