Starling is certainly not the only digital bank out there, so we’ve compared it against the competition to see what the best option is.
Starling is a challenger bank with around 500,000 customers in the UK, offering digital-only current accounts (and a bunch of related services) to its 500,000 UK customers. If you’ve checked it out but for some reason was unimpressed, fear not, there are others you can consider.
Digital banking deals
Free card worth £5 from Revolut
Click the button and enter your number to receive a free Revolut card.
Starling voted best British bank & current account
No branches, no fees, no paperwork. Get a smarter kind of bank account with the Best British Bank 2018 – all in under 3 minutes!
Get N26 the new bank you'll love to use
Manage everything directly in the N26 app. Set payment limits, change your PIN number and lock and unlock your card. All in real-time.
Download the Monese app and get your free card
Click the button to head to the app store, download the app, and your Monese card will be sent in the post.
Banks like Starling for day-to-day banking
Challenger banks don’t offer a broad range of services yet, but they all provide fee-free digital-only current accounts that can be opened in a few minutes, and that can easily function as main current accounts as long as you have fairly essential banking needs. With all of them you can expect a free current account, card and app, and free bank transfers and card payments within the UK.
If you rule Starling out, your main options are:
- Monzo. The most popular challenger bank in the UK with its two-million-strong user base, Monzo is probably the most similar to Starling, and ticks most of the boxes (you can set up direct debits, use Google Pay and Apple Pay, and ATM withdrawals are free). You can also deposit cash on your account at PayPoints for £1 a transaction, and is the only one apart from Starling that’s offering overdrafts (you can go overdrawn up to £20 for free, and it’s 50p a day after that).
- N26. It only launched in the UK in late 2018, but it already offers a fully developed bank account and can adequately compete with Monzo and Starling. It offers most of the basic features you may need for free, but it doesn’t do overdrafts yet, and you can only load cash on your account if you live in Germany.
- Revolut. Revolut was born as a multi-currency card more than as a bank account, and it shows when it comes to some basic day-to-day banking: in the UK, you can’t set up direct debits yet and free cash withdrawals are limited to £200 a month.
Day-to-day banking: The verdict
As we said, Monzo is the most similar to Starling and the one with the broadest range of features for day-to-day banking. However, you could also give N26 a chance – having launched recently, it will probably add new features in the coming months. It could also be a good shout if you’re interested in a premium option with more benefits (see our review of N26 You and N26 Metal for more on this).
- Take control of your finances with one app
- Manage everything directly in the N26 app
- Set payment limits; change your PIN; lock and unlock your card
- Make no-fee transactions anywhere in the world
Cards like Starling for travelling
Generally speaking, challengers will treat you better than traditional banks when it comes to doing all things money out of the country. Depending on whether you’re a serial travel, only have the occasional trip or mostly stay in the UK but need to send money to someone who doesn’t, some will be more suitable than others:
- Card payments. Apart from Monese (which charges a 2% currency exchange fee unless you upgrade your account to a Plus or Premium option), you can use your card abroad for free with all the others. At weekends, Revolut charges a 0.5% markup fee.
- ATM withdrawals. Both Monzo and Revolut allow them for free but they’re limited to £200 a month (after that, Monzo charges a 3% fee, Revolut a 2%).
- Euro accounts. Together with Starling, Monese is the only challenger offering a free euro account together with your regular sterling one.
- Money transfers. Revolut is in for an easy win here – the others all charge a fee, while with Revolut you can transfer money in 29 currencies at the interbank rate for no fees, up to £5,000 a month.
Travelling: The verdict
Let’s face it, if you’re looking for a card that will give you great freedom abroad without charging any fees, you should probably reconsider your reluctance over Starling – it’s the only one that offers free ATM withdrawals in another currency with a limit of £300 a day.
However, Revolut makes for a good alternative that has reasonable fees and if you also need money transfers, it definitely stands above the competition.
- Spend abroad with no fees
- Great for international students
- Simple to set up
- Visualise your spending in real time
- Trusted by 2 million users
Alternatives to Starling for saving
Challengers are still at the beginning of the journey when it comes to savings accounts, so if putting money aside and earning interest on it is your main goal, you may also want to have a look at what traditional banks have to offer.
Starling is the only challenger that pays an interest on current account balances (0.5% up to £2,000, 0.25% between £2,000 and £85,000), but you can’t open a separate savings account. Among the others, Atom is the only one that offers savings accounts, with a good range of fixed-term options that pay decent rates. However, it offers no easy-access savings accounts.
Monzo is currently working on a savings market place, and currently has three different partners that offer both easy-access and fixed-term accounts. The rates aren’t half bad, but you can still get better ones if you go to the source and open an account directly with the provider.
Finally, Monzo, N26 and Revolut all categorise your spending in the app and allow you to put money aside in separate sub-accounts (respectively known as Pots, Spaces and Vaults) to save towards a goal. Monzo and Revolut also have a feature that automatically rounds up and saves your spare change, functioning as a digital piggybank.
Savings: The verdict
If you’re only looking at how much money your savings can earn you, Atom is competitive for fixed-term accounts, while the others still have quite a long way to go.
On the other hand, if you find organising your budget and saving money challenging, both Revolut and Monzo have slick apps with loads of useful features that can help you organise your money and save.
Are challengers safe?
The short answer is yes – all the challengers we’ve mentioned are registered with the Financial Conduct Authority (FCA) and fully authorised to do what they do. However, there is a slight difference when it comes to how your money is protected:
- Financial Services Compensation Scheme (FSCS). It protects all deposits up to £85,000 and applies to institutions that have a full banking licence. That is: Monzo, Starling, Atom bank and N26 (whose licence is registered in Germany, and so is the deposit protection).
- Segregated accounts. Institutions that only have a licence for dealing in electronic money have to keep all clients’ money in segregated accounts, from where it can’t be used to pay the company’s debt and is thus safe in case of bankruptcy. That’s the case for Monese; Revolut recently got a European banking licence, but until it’s fully finalised, deposit protection doesn’t apply and client money will still be kept separate from company money.