The Starling Bank banking app on a smartphone.
Adrian Dennis | AFP via Getty Images
LONDON — British digital bank Starling reported a sevenfold increase in revenue in the 16 months ending March 2021 as its lending soared, helping to cut losses in half.
Losses after tax totaled £23.3 million ($32 million) in the period, down from the £52.1 million Starling lost in its last annual accounts, which covered the 12 months up to Nov. 30.
Revenues, meanwhile, shot up 600% to £97.6 million from £14 million in its 2019 results.
Starling said it changed its financial year-end from Nov. 30 to March 31 to make it easier for shareholders to compare results on a quarterly basis.
The London-based firm has been significantly growing its balance sheet amid a surge in lending thanks to government-backed financing schemes aimed at helping businesses through the coronavirus pandemic.
Starling said the amount of lending on its books spiked to £2.2 billion “from a very low base.” This helped the bank break even for the first time in Oct. 2020, Starling said, adding that it has made a profit each month since then.
In a trading update Thursday, Starling said sales reached £42.8 million in three months to the end of June 2021, giving it an annual run rate of £170 million.
Starling is now “very much on track to post our first full year of profitability” in its 2022 fiscal results, CEO and founder Anne Boden told reporters on a call Thursday.
The bank’s shift toward profitability marks a divergence from fellow fintechs Monzo and Revolut, which saw their losses mount in 2020.
Monzo racked up a post-tax loss of £113.8 million in the 12 months to February 2020, up from £47.1 million a year earlier. The London fintech, which saw its market value slashed by 40% to £1.25 billion last year, warned disruption from Covid-19 had led to “significant doubt” about its ability to continue “as a going concern.”