Starling Bank cuts 130 jobs as AI adoption accelerates across neobank operations

Starling Bank cuts 130 jobs in AI and restructuring push

Starling Bank is cutting around 130 jobs as it restructures operations and pushes AI deeper into its business. The neobank's profits fell for a second consecutive year, but its technology licensing arm Engine grew revenue 25%. Starling Bank is cutting around 130 jobs, roughly 3% of its 4,000-strong workforce, as the London-based neobank restructures its banking and technology operations. Staff were told this week that the changes were intended to simplify how the company operates, reduce duplication, and accelerate product delivery. The cuts come as Starling pushes AI deeper into its operations. In March, it launched Starling Assistant, an agentic AI tool that can set up savings goals, organise bill payments, and quiz customers on their spending patterns using voice or text prompts. Falling profits in a falling-rate world The restructuring follows a second consecutive year of declining earnings. Pre-tax profit fell to £217 million in the year to March, down from £223 million a year earlier, while total revenue dropped from £940 million to £887 million. Starling attributed the decline to falling interest rates, which have squeezed margins across UK banking. The neobank remains profitable, having now posted five consecutive years in the black, but the direction of travel is clear. Customer numbers continued to grow, with platform accounts reaching 6.2 million, up from 5.3 million the previous year. Deposits rose to £12.7 billion. The AI arms race among neobanks Starling's AI push is part of a broader race among digital banks to automate customer-facing operations. Revolut launched its own AI assistant, AIR, to UK customers in April, offering similar capabilities around spending analysis and account management. Starling's scam detection tool, launched in October 2025, uses Google's Gemini models to analyse marketplace listings and flag fraud in real time. The tool has since been expanded to detect more than ten types of scam, including romance fraud and deepfake phishing. "A key factor in our competitive edge over legacy banks is our agility, our ability to test, launch, learn and reorganise at pace," a Starling spokesperson said. The bank added that it is continuing to hire technology and AI engineers even as it cuts elsewhere. Engine as the growth story The brighter part of Starling's business is Engine, the software-as-a-service arm that licenses the bank's core technology stack to other financial institutions. Engine's revenue grew 25% last year as its client base doubled on international demand. Engine already powers banks in the UK, Romania, Australia, and New Zealand, and is now targeting the US market. The division has opened an office in New York with a reported $50 million investment and is in discussions with mid-tier American lenders. A sector-wide shift Morgan Stanley estimated in June that AI could eliminate as many as 400,000 European banking jobs by 2030, double its earlier forecast of 200,000. ABN Amro announced last year that it would cut roughly 20% of its workforce by 2028, primarily through automation. Starling's 130 cuts are modest by comparison, but they signal a shift within the neobank sector itself. The digital challengers that once defined themselves against the bloated workforces of high-street banks are now applying the same efficiency logic to their own operations.

Starling Bank to cut 130 jobs and boost investment in AI to reduce costs

The London-based fintech said the restructuring was necessary to reduce 'duplicate' roles Starling Bank has said it will cut more than 100 jobs from its workforce, as it invests more heavily in artificial intelligence to push down costs. The digital-only bank told staff that 3% of its workforce, or 130 jobs, would be made redundant, as part of a restructuring of its banking and tech operations. The London-based fintech, which employs more than 4,000 people, said the restructuring was necessary as it reduced "duplicate" roles and stepped up its spending on AI. The bank said that a factor in its "competitive edge over legacy banks" was its "agility" and "ability to rest, launch, learn and reorganise at pace". "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," it said. "We have begun a period of consultation with colleagues whose roles may be affected by these changes." The cuts come at a critical point for the bank, which reported a 6% drop in revenue in the year ended in March to £887m. Its pre-tax profit dropped 3% to £217m, which it said was partly due to investments in its digital banking software, Engine. Starling, which was founded in 2014 by the former Royal Bank of Scotland executive Anne Boden, was part of a trio of online-only neo-banks which emerged in the mid-2010s to disrupt traditional banking in the UK, alongside Revolut and Monzo. It has 6.2 million customers, with the majority of these in the UK. However, like several of its peers, it has struggled to expand abroad and in 2022 gave up on a bid to secure a European banking licence. Its growth also took a hit in 2021 after the UK's financial watchdog placed restrictions on it due to findings around poor financial crime controls. The rules stopped Starling from opening new accounts for high-risk customers. In 2024, the Financial Conduct Authority then found the bank had operated with "shockingly lax" controls, which it said had "left the financial system wide open to criminals and those subject to sanctions". The regulator fined it £29m. However, there has long been speculation that the bank could list on the stock market. In January, Starling's chief executive, Raman Bhatia, told the Sunday Times that while there were no "firm plans", he could "see this business as a plc ... in a near-term window".

Starling to axe 130 jobs as part of automation drive

This content has been selected, created and edited by the Finextra editorial team based upon its relevance and interest to our community. The digital-first bank has told staff it will be restructuring its banking and tech operations and plans to increase its investment in AI. As a result, there will be around 130 job losses in order to eliminate duplicate roles and to speed up product launches. "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," read a statement from Starling, first reported by the Financial Times. The move follows a decline in profits and revenue, as reported in the bank's results for the last financial year, published in May. Revenue fell by 5.6% to £887m while profit slipped 3% to £217m. According to the bank, the need for "agility" and the "ability to rest, launch, learn and reorganise at pace" were factors in its "competitive edge over legacy banks". Starling also announced a boardroom shakeup recently which included the appointment of HSBC CEO Colin Bell as chair as well as the departure of two directors.