Starling Bank eliminates 130 positions as part of its AI initiatives and restructuring efforts.
Starling Bank is reducing its workforce by approximately 130 jobs, which constitutes about 3% of its 4,000 employees, as the London-based neobank restructures its banking and technology functions. Employees were informed this week that the adjustments aim to simplify operations, minimize redundancy, and speed up product delivery.
These job cuts coincide with Starling's effort to integrate AI more extensively into its processes. In March, the bank introduced Starling Assistant, an AI tool that enables users to establish savings goals, manage bill payments, and inquire about their spending habits via voice or text prompts.
Declining profits amid lower interest rates
This restructuring comes after the bank experienced a decline in profits for the second consecutive year. Pre-tax profit decreased to £217 million for the year ending in March, down from £223 million the prior year, while overall revenue fell from £940 million to £887 million. Starling attributes this downturn to lower interest rates, which have affected profit margins in UK banking. Although the neobank has achieved profitability for five consecutive years, the trend is concerning.
Customer growth continued, with accounts on the platform reaching 6.2 million, up from 5.3 million the previous year, and deposits increasing to £12.7 billion.
The AI competition among neobanks
Starling’s focus on AI is part of a larger trend among digital banks to automate customer-facing services. In April, Revolut introduced its own AI assistant, AIR, to UK users, offering similar functionalities for spending analysis and account management.
Starling’s scam detection tool, which debuted in October 2025, utilizes Google’s Gemini models to evaluate marketplace listings and identify fraud in real time. This feature has since expanded to detect over ten different types of scams, including romance fraud and deepfake phishing.
“A significant advantage we have over traditional banks is our agility, allowing us to test, launch, learn, and adapt quickly,” a spokesperson for Starling stated, noting that the bank continues to recruit technology and AI engineers even as it makes job cuts.
Engine as a growth narrative
A more positive aspect of Starling’s operations is Engine, the software-as-a-service division that licenses the bank's core technology to other financial institutions. Last year, Engine's revenue rose by 25% as its client base doubled due to international demand.
Engine currently supports banks in the UK, Romania, Australia, and New Zealand and is now aiming to enter the US market. The division has established an office in New York with a reported investment of $50 million and is in talks with mid-tier American lenders.
A sector-wide transformation
Morgan Stanley projected in June that AI could displace as many as 400,000 banking jobs in Europe by 2030, doubling its previous estimate of 200,000. Last year, ABN Amro announced plans to cut approximately 20% of its workforce by 2028, largely through automation.
In contrast, Starling's plan to cut 130 jobs appears modest, but it indicates a significant shift within the neobank sector. Digital challengers, which once distinguished themselves from the large workforces of traditional banks, are now applying similar efficiency measures to their own operations.
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Starling Bank eliminates 130 positions as part of its AI initiatives and restructuring efforts.
London-based neobank Starling is reducing its workforce by 3% as it experiences a decline in profits for the second consecutive year. At the same time, it is recruiting AI engineers and broadening its Engine SaaS platform into the United States.