When I spot Anne Boden across the coffee shop, she beams at me.
Even before she’s said a word, I immediately warm to her – here’s a woman who has spent 30 years working for the big banks, and yet she seems far removed from the stereotypical personalities you associate with the cutthroat finance industry.
But perhaps the reason Boden’s new business is unique is because she isn’t your ordinary banking boss.
For one thing, she’s not a man. But she’s also full of a contagious enthusiasm which isn’t always prevalent among the financial execs I’ve met throughout my career.
On the surface, Starling Bank might look like most fresh-faced fintech firms, but it’s the banking licence which sets the company apart – allowing it to take cash deposits and lend money out.
“What we are doing is a little bit different to everyone else because we are a proper bank,” she says, pointing to the company’s current account offering and B2B service.
Unlike many fintechs, which often end up being loss-making because they have to pay the banks to process their payments, Swansea-born Boden says the “viability and profitability” of Starling makes the business model easier to grasp.
But Starling’s proposition differs to the banks too – because it offers a mobile-only current account, designed for users who do everything through their phones. You can use your “digital wallet” to do everything a normal bank would, from making payments to setting up direct debits.
It also comes with extra features, like sending a real-time update to your phone when a payment is made, and giving you an overview of your spending habits by assembling your payments into categories.
Users can also upgrade to a business account, providing the versatility that professionals often need.
Ultimately it’s designed to give you more control of your money, which in turn could encourage you to make good financial decisions.
It’s clear that Boden’s computer science background has steered Starling in its tech-oriented direction. “There are not many banks in the UK with brand new technology doing this, so lots of corporates are asking us to process their payments,” she says.
In fact, Starling recently bagged a contract with the Department for Work and Pensions (DWP).
Raising the bar
Challenger banks have been raising customer expectations and lowering prices over the years, and since its launch in 2014, Starling has been intent on doing the same.
Value is certainly a hot topic in most boardrooms at the moment – and Boden has garnered interest from chief executives of the big banks who are keen to see how she is delivering value for customers.
Boden says the banking giants can copy the app, but they can’t copy the cost base, or the fact that Starling can innovate very quickly.
“There is plenty of technology out there, but the problem with a lot of the big banks is that they struggle to migrate,” she says.
Bearing in mind it typically takes around seven years and a couple of billion pounds for a big bank to move all of their customers to new technology, it takes a pretty brave banking boss to start the project.
This – on top of tighter regulations – means that fewer companies are embarking on the big transformation. Many of the big banks are stuck – trapped in outdated legacy systems that don’t gel with our digital lives.
On a mission
Having held executive roles at many financial institutions, including UBS, PriceWaterhouseCoopers and Standard Chartered to name but a few, Boden has seen the economics that still override banking services. She even had an integral part to play in the mission to rescue the Royal Bank of Scotland after the 2008 financial crisis.
“But it was only after stepping away for a year and working in fintech that I realised the world had changed,” she says, pointing out that new technology was changing the way she was living her life, but that the banks had failed to catch up.
“I thought: what if you don’t have all the bank branches and associated admin costs? So with that in mind, I decided I was going to build a bank that had a very different cost base, using very different technology.
“It was important to me that Starling was totally transformative; we need to think of the technology of Netflix and apply it to banking.”
Setting up a bank comes with some hefty overheads, because you need at least £50m to get it off the ground. Boden jokes that people would back away when she told them about her plan.
And yet Starling has been gathering support, and last year it managed to secure $70m from quantitative trader Harald McPike.
Boden also says she’s seen a surprising number of people opening a Starling current account, helped by the government reforms, which aim to make it easier for customers to switch to different bank accounts.
Here is a business that is looking to keep up with the pace of change, and Starling is starting to shake up the way we run our finances. Boden says: “All of a sudden it’s about everyday money and convenience, rather than long term money.”
Straddling the ground between the banks and fintech startups, Starling is definitely one to watch out for.