Thu, 21 Aug 2025 | BUSINESS SALE
London based Starling Bank has acquired a UK fintech company, Ember, to enhance its services for small businesses. This move aims to expand Starling's offerings in the small business sector, where it currently holds a 9 per cent market share. The acquisition includes integrating Ember's tax and bookkeeping software into Starling's app and online banking platform. Ember's software is HMRC-recognised and will become exclusive to Starling, replacing its current providers like HSBC, Revolut, Barclays, and Lloyds.
Declan Ferguson, Group Chief Financial Officer, Starling Group, said: “We are a natural fintech consolidator, so targeted acquisitions like Ember will form a key part of our strategy as we continue to develop Starling Bank in the UK and Engine by Starling overseas. Just as Fleet Mortgages has flourished since we bought it in 2021, I’m confident that Ember’s best-in-class tools will become a fantastic addition to Starling Bank’s offering.”
This move aligns with a trend where neobanks are increasingly focusing on small business banking, especially as traditional banks have reduced their involvement in this area.
The British Business Bank reported that challenger banks now account for approximately 60 per cent of gross lending to small and medium-sized enterprises (SMEs), a significant increase from nearly two decades ago when the four largest banks dominated with 90 per cent of SME lending. However, recent data from UK Finance indicates that high street banks are re-entering the SME lending market, with loans to small businesses reaching £4.6 billion in the first quarter of 2025, marking a 14 per cent year-on-year increase.
Starling's acquisition of Ember also reflects a broader trend among UK fintechs to diversify their revenue streams. For instance, Monzo is exploring plans to offer mobile phone services, following in the footsteps of rivals Revolut and Klarna.
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