May 16, 2020

What is Starling Bank’s “shed economy”? 

Shed economy
Starling Bank
Debit cards
New accounts
Amber Donovan-Stevens
3 min
According to Starling, the UK has a £17bn “shed economy,” comprising over 104,000 micro-businesses that operate from their garden sheds.

At the st...

According to Starling, the UK has a £17bn “shed economy,” comprising over 104,000 micro-businesses that operate from their garden sheds. 

At the start of March, challenger bank Starling shared its study that discovered over 104,000 micro-businesses run their businesses exclusively out of their garden sheds. The research was conducted by Opinum in Feburary 2020, gathering data from a total of 700 micro-businesses and 700 sole traders. It was also discovered that shed workers were found to be four times less likely to be stressed compared to those who work from an office (7% against 28%), as well as those who work from their sheds have a better work-life balance (76% against 65%).

These are the stats that inspired its latest UK advert, which marked the launch of its SME campaign, Helping Business Fly:

Anne Boden, founder and CEO of the UK bank said: “We have a tradition of entrepreneurialism in the UK and this, combined with the growing emphasis on a healthy work-life balance, has led to an explosion in people working from their homes.”

She continues, “More people are opting for the freedom of being their own boss. That’s why we designed a business bank account that allows entrepreneurs to run their business’ finances from their mobile phones.”

Shed economy in the time of Coronavirus

During this turbulent time, both large and small businesses are coming under fire as they try to navigate government shutdowns that have been implemented across the UK as a result of the growing pandemic COVID-19.

It is important to note that on 17th March, the UK Chancellor made the announcement of a £330bn business aid package, an amount equivalent to 15% of UK GDP. The Government has replaced the Enterprise Financial Guarantee Scheme (EFG) with the Coronavirus Business Interruption Loan Scheme (CBILS), enabling the government to encourage lenders to provide loans to businesses hit by the debt by acting as guarantors. the CBILS loan can be accessed via the British Business Bank, which is state-backed. 

For more information and updates on the development of this support, see here. 

A thriving challenger bank

Starling has thrived so far in 2020. It swept up three awards at The British Bank Awards 2020, run by Smart Money People: 'Best Current Account Provider', 'Best Business Banking Provider' and ‘Best British Bank.’ Recently it was announced that Starling would be the “Bank of Team GB” at the Tokyo Olympics 2020. The partnership will assist the team in getting to the summer and winter Olympic Games and will provide the bank with global exposure. 

But the bank isn’t showing any signs of slowing down. In an interview with IBS, Boden has bared Starling’s ambitions in a recent interview with IBS Intelligence. She shared that the bank plans to use an Irish banking license to passport into European countries in the coming years. 


“We’re working on a process to get an Irish banking licence, which will mean that we can have a European Centre in Dublin and then passport out of Dublin, out of Ireland, into European countries. So we very much hope that in a couple of years’ time, you’ll be seeing us across Europe,” Boden said.

For more information on all topics for FinTech, please take a look at the latest edition of FinTech magazine.

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Jun 17, 2021

Zafin: Banking is now in the era of the tech ecosystem

3 min
FinTech Magazine holds a Q&A session with John Smith, EVP Ecosystem at Zafin, on the evolution of banking and its future as an aspect of tech ecosystems

The development of tech ecosystems is placing the future of post-COVID banking in jeopardy. At a time when Big Tech can replicate the functions of traditional financial institutions, what can banks do to retain a grip on the market?

John Smith, EVP Ecosystem at Zafin, has a few ideas. A SaaS cloud-native product and pricing platform for financial institutions, Zafin is preparing the next generation of banks to cope with this precise challenge.

Smith is responsible for the strategic and tactical management of the company’s ecosystem, including the creation of new business models to support growth and differentiation. We asked him four questions:  

Q. Have the events of the pandemic caused an irreversible shift in the digitalisation of banks? If so, is COVID the sole cause or are there other factors?

It’s a great question and one that I am asked a lot. Without a doubt, the COVID-19 pandemic has driven a significant shift in the acceleration of digital. In fact, I’ve seen some estimates show there to have been as much as four to six years of digital adoption growth since the initial lockdown started. 

While the pandemic may be the primary reason for this growth, two other drivers include fintech disruption and the high costs of operating a traditional retail bank. Both of these factors have caught the attention of banking executives as they set their minds on accelerating digital transformation with a focus on high return, low risk. 

Q. Some commentators believe banks must learn from Big Tech in order to survive. Do you agree? Please expand. 

I agree completely; we’re living in the era of the ‘ecosystem’. All the seismic shifts we’re seeing in technology, be it aggregation, embedded finance, DeFi or hyper-personalisation are all enabled by the foundation of an ecosystem.  

When financial institutions work with a strategic partner like Zafin, which has made the strategic investments in a best-in-class ecosystem, they’re able to capitalise on opportunities more quickly and safely, and will be better positioned for growth now and at the other side of the pandemic. 

Q. What are currently the obstacles to adopting Open Banking? Is it more likely to 'take off' in some regions rather than others?

I would argue that Open Banking has been in the US for some time and will only continue to grow there. By definition, Open Banking is about the secure sharing of financial information that customers are aware of and have authorised. Under that definition, we’re seeing aspects of this well underway even though its full potential remains to be seen.

Third-Party Providers are a natural outcome of Open Banking, whereby they can create propositions beyond what a bank normally does to enable banking functions such as payments, borrowing, saving and so on. Once again, some of these are already present through industry-led initiatives, whereas regions such as the EU have taken the pathway of regulation such as PSD2.  

The industry-led initiatives we’ve seen in the US have also had the added advantage of guard-rails that regulatory bodies like FFIEC and CFPB provide. There are also other technology-led initiatives such as API definitions that are set out through the FS-ISAC. 

I would argue the future of Open Banking in North America will be through the natural evolution of the guidelines and API definitions that have been published, as well as the natural progression of industry initiatives. 

Q. Are there any other bank tech trends you'd like to discuss? 

Coreless banking. Zafin has been pioneering some of the work around externalising functions out of the legacy core to drive a more ‘fintech nimble’ bank, while not having to deliver a ‘heart and lungs’ core bank replacement. 

Real life examples of this include moving some of the core functions of a banking system, such as product and pricing to a platform like Zafin. Origination, onboarding, KYC, risk, and compliance are all other examples of externalising banking functions for added agility.

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