Starling Business Account Review

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Challenger banks are on the rise, looking to scoop up startups and sole traders with their advanced, low-cost features. These banks are perfect for forward-thinking entrepreneurs and business owners who are not keen on physical locations and traditional banks. Over the past few years, the number of challenger banks has grown exponentially, each trying to capture a piece of the market.

Starling Bank is one of the more notable options in the market and one that has been around for some time. It offers various services and plans, including multiple business accounts, which we will look at in this review.

What is Starling Bank?

Starling Bank is a UK-based digital challenger bank often considered one of the best business banking providers on the market currently, besides other business banking options such as Pay iO.

Starling is licensed and regulated by the Prudential Regulation Authority and the Financial Conduct Authority. For its efforts in the financial sector, Starling has received multiple awards, including the Best British Bank award at the British Bank Awards for four consecutive years from 2018 to 2021.

Starling Bank has been credited with taking a modern approach to banking that offers the same tools and services provided by high-street banks but with the convenience of being completely digital. Starling provides banking services to more than 500,000 UK businesses, and unlike some other online banks, Starling is fully regulated.

While Starling doesn’t have any physical bank branches, it has bolstered its service in other parts to compensate for the loss of face-to-face time, such as;

  • Speedy signups
  • Mastercard debit card as a standard
  • 24/7 in-app customer service
  • Free money management tools

How to Open an Account with Starling Bank

Starling provides personal, joint and business accounts for UK residents aged 16 and over. A Starling business account is available for;

  • Limited companies (LP)
  • Limited liability companies (LLP)

If you’re registered at Companies House, you are eligible to open a Starling business bank account. General partnerships or charities not yet registered as limited companies are not supported.

Limited Companies and LLPs need all Persons of Significant Control (PSCs) to be UK residents and natural persons.

All directors with access to the account must be UK residents to qualify to open a business account with Starling Bank. The business must not be a holding company, dissolved, liquidated, or engage in any activities set out in Starling Bank’s terms and conditions.

You must be able to produce evidence of your trading activities so parties can verify that your business does what it says it does. Companies House documents are not accepted to prove the activity of your company.

Additionally, your company must meet its standards for AML/KYC, fraud and credit checks and processes. You can refer to the Starling Bank website for more information on the terms and conditions to check whether your activities or sector is supported.

Everything else is smooth sailing once you meet the requirements for opening a Starling business bank account. You will provide a valid photo ID such as a passport or UK driving license and documents confirming the nature of your business. Complete the online registration form, which takes about 10 minutes, and once submitted, Starling Bank will review the details and get the account up and running for you.

How Does Starling Business Work?  

The Starling Bank business account meets the most important requirements for a functional business account. It takes minutes to create, and once up, banking is reduced to a series of swipes and taps. The app also helps with automatic categorisation and tracking of receipts.

To create the account, users download the app, enter their details and provide information about the business. Starling will then verify identity by having the application send a video and ID documents.

Once the account is set up, you can easily manage business spending and payments within the app. Although the account is available to all types of businesses, it is clear that Starling mainly focuses on small businesses and solopreneurs from the onset.

With the Startling Bank business app, you can get balance updates, instant payment notifications and assistance keeping track of day-to-day expenditures.

Starling Bank Business Account Key Features

The business account offers most of the same features and benefits as the personal account and then some. Business account users receive payment alerts, and the apps collect and categorise all transactions for a real-time MTD spending report.

Unlike traditional accounts, the Starling Bank Business account has no monthly account service fee or a per-transaction charge. Also, Starling has an app marketplace that allows it to extend its functionality. The marketplace is where you can find all the apps you can integrate with Starling Bank.

You can integrate the Starling bank account with popular accounting software like FreeAgent and Xero. The company is always adding new integrative apps to its marketplace to increase business functionality and convenience.

With the business account, users can make deposits and withdrawals in person at more than 11,500 Post Office branches nationwide.

Starling Bank Business Current Account

Starling offers various business products that consumers can select from depending on their needs. The Business Current Account is Starling’s core product. It is a business account used for the day-to-day operations of LPs, LLPs and startups.

Some of the features of this account are;

  • UK bank transfers
  • International payments
  • Free bank ATM fees
  • Multi director’s access
  • Integration with tools like QuickBooks and Xero
  • Users can deposit cash and cheques (limits apply)
  • Digital receipts
  • Spaces (ability to move funds for different purposes and goals)
  • Access to Startling Business marketplace
  • Instant payment notifications
  • Multiple director’s account access
  • Fee-free spending outside the UK
  • The account is protected by the FSCS up to £85,000

You can also customise the business’s current account with additional modules to match the needs of your business. The goal here is to create an account that is most capable of handling the needs of your business. You can add as many available modules as you want using the mobile app.

The list of add-ons includes the following;

The Business Toolkit

This additional feature is designed for invoicing, bill payments and expense management. It’s free for the first month and then £7 per month. Some of the common features in this toolkit include;

  • Invoice creation and auto-matching
  • Bill management
  • Automatic categorisation of expenses includes suggestions for what is tax deductible.
  • Sole trade tax estimation
  • Making Tax Digital VAT submissions
  • Bookkeeping to-do-list. Prompts to attach receipts or invoices for good record keeping.

While the toolkit is absolutely handy, it is only available on desktop. You won’t be able to manage your accounting from the mobile app.

Multi-currency account feature

You can add a EUR or USD account to boost your GBP account. This allows you to hold, store, receive and make payments in the respective currencies.

Security and Protection

With digital banks, security and safety are a priority, and Startling Bank has invested in the best security measures for its clients and their data. Starling is a licensed bank. They’re regulated by the FCA, and your funds are protected by the Financial Services Compensation Scheme (FSCS).

You can also protect access to your Starling account with a PIN, Password or Touch ID. Instant notifications warn you of any unusual activity to protect you against fraud, and you can freeze cards and set spending limits via the Starling App.

Purchases are protected by 3D security. You will receive a notification to authorise payments. You can do this using one tap.

Overdrafts

Surprisingly, Starling’s business offers overdrafts. This is unlike most online banks. The overdraft limits start at £1,000 to £50,000 with varying interest rates of up to 15% EAR depending on various factors. The arrangement fee is 1.75% of the agreed limit with a minimum of £50.

Starling Bank Reviews

Starling Banks has garnered excellent reviews from its thousands of customers. It has an excellent 4.4 stars out of 5 rating on Trustpilot from over 38,500 reviews, with over 75% rating it a 5-star.

The Starling app also gets an excellent rating of 4.9 stars out of 5 on the App Store from over 470,000 ratings, and users give them 4.8 stars out of 5 on Google Play from over 112,000 reviews.

Starling Bank Business Account Benefits

From this quick review, here is are breakdown of the pros and cons of considering and using a Starling Business account;

  • Like Pay iO and other mobile-only banks, Starling is easy and convenient to use
  • New accounts can be up and running in about 10 minutes
  • No joining or monthly fees
  • Contactless debit card delivered within a week
  • The spending insights feature helps you scrutinise, categorise and track spending by category.
  • There are no spending fees abroad, and the Mastercard exchange rate
  • 24/7 customer service
  • Integration with popular small business accounting software
  • Users can pay in at over 11,000 Post Office branches around the country
  • The account is regulated by the PRA and FCA. Also, deposits are protected by the FSCS.

Starling Bank Business Account Dis-advantages  

  • The range of business accounts is limited to just two.
  • There is no business credit card. But there’s an overdraft facility available
  • Interest on loans and overdrafts is rather high, with the average being 11.50% EAR
  • In-person deposits or withdrawals at the post office incur a fee starting at £3 per deposit and £0.50 per withdrawal.
  • Transactions may need to be repeated if you lose your mobile connection or the app malfunctions.
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