Starling Business Loans: Overview, Interest Rate and Fees

Paola Faben Oliveira

Since Anne Boden set the foundation of Starling in 2014, Starling Bank has been making inroads in the UK financial industry. The bank is the first UK digital challenger bank recognised for its digital banking products. It has swiftly acquired popularity among small and medium-sized enterprises (SMEs).

Starling Bank, with its tagline "free, uncomplicated, and quick," provides a variety of business solutions, including Startling business loans and Starling bank overdrafts.

Business loans allow firms to obtain the funds they require to grow, invest, and oversee their cash flow. These loans can be used to acquire new assets, expand corporate operations, or recruit new employees.

In this article, we'll look into Starling Bank business loans and how they might help companies who need flexible funding. We'll also review the Starling Bank overdraft, its qualifying requirements, and how to open a Starling business account.

📝 Table of contents:

Starling bank business loans

Starling Business Loans are designed to provide limited companies and limited liability partnerships with unsecured business loans. These loans are available in the range of £25,001 to £250,000.

To secure the loan, a personal guarantee is required. You will make fixed monthly payments over a repayment period of 12 to 72 months. At the time of drawdown, you will need to pay a one-time loan arrangement fee of 4% of the loan amount.

However, to qualify for a Starling Business Loan, your business should be based in the UK, have been trading for at least two years, and pass a credit and fraud check.

To start the application process, simply fill out the online form on the Starling website. It is essential to know that the person completing the form must be authorised to act on behalf of the business and must be a director or partner of the applying business.

Key facts about Starling Business loans

🧾 Pre-existing account needed?Yes¹
📲 UK customer service?Yes. Phone, email and in-app chat
⭐ Trustpilot rating4.3 out of 5²
💰 Interest rate typeFixed¹
💸 Amount borrowable£ 25,001 to £250,000¹
📅Term lengthBetween 12 to 72 months¹

Starling business account interest rate

It is important to keep in mind that every application is subject to a rigorous credit evaluation in order to establish the interest rate on your business loan. The tailored rate that you are provided will be influenced by your company's unique circumstances. There is no interest amount payable on positive balances on your Business Current Accounts.

By opening a Starling business account, you will have the option to access two premium services: Business Toolkit and Bulk Payments, for a monthly fee of £7 each (paid in advance).³

In terms of other fees, there is a one-time loan arrangement fee of 4% that is payable at the point of drawdown for your Starling Business Loan. There is no application fee, ATM fee or UK transfer fee.

💡 Read more about starling business account fees

If you agree to the Starling Bank Overdraft Facility, the bank will charge you interest at a rate that is clearly confirmed to you beforehand and that you can see in your mobile app. The interest will accumulate on a daily basis.

Starling business loans eligibility

To be eligible for a Starling Bank Business Loan, your business must be based in the UK and have been trading for at least 24 months

If you're not already a Starling Business Current Account customer, you'll need to open an account and switch your primary business banking to Starling.

Your business needs to be financially viable, which will be assessed as part of the creditworthiness review. Also, Starling will check the credit and fraud history of all applicants, including the business and its directors or people with significant control.

Application Process:
To apply for a Starling Bank business loan, you need to visit the lender's website and provide information such as:

  • Personal details.
  • Business name and type.
  • Company registration number.
  • Reason for applying.
  • Business accounts and bank statements for the previous six months if you don't currently bank with Starling.

The lender will also conduct a credit check on the company and its directors as part of the application review process.

Starling bank overdraft

A Business Overdraft is a type of credit that is available on your Business Current Account to provide short-term cash flow support. With Starling Bank Overdraft, you can get access to a short-term safety net for your business's cash flow needs.

It serves as a viable alternative to Business loans and helps you pay for transactions even when your account balance is insufficient. You can borrow £1,000 up to £50,000, and you only pay interest on the balance you use. It has a 1.75% arrangement fee at acceptance and on an annual basis.⁴

Starling overdraft eligibility

To be eligible for a Starling Bank Overdraft, your business must meet certain requirements.

  • You must be a UK-based borrower who carries out trading activity in the UK.
  • Your business must have been trading for at least 24 months.
  • If you are not already a Starling business customer, you will need to open an account and transfer your primary business banking to Starling.
  • As part of their creditworthiness assessment, Starling will review the viability of your business. They will also conduct credit and fraud checks for all applicants, which include a check on your business and its Directors/PSCs.

Business Overdrafts are available for limited companies and limited liability partnerships, subject to a full credit assessment by the Starling Bank Lending team.

Starling business loans pros and cons

Here are a few more potential pros and cons to consider:

  • Quick and easy online application process
  • There is no application fee
  • Starling business accounts integrate with various accounting platforms
  • Interest rates may be higher than some other lenders, particularly for businesses with weaker credit score
  • Maximum loan is £250,000 which may not be sufficient for larger businesses with more significant funding needs
  • In-person support is not available

When looking for a new baking prodiver it is good to check all options available. Starling Bank can be a good option if you need smaller loans and conduct transactions mostly in the UK with the Sterling Pound, but if you do business internationally, a dedicated multi-currency account can be a better option to save you time and money paying and being paid across borders.

💡 Read more: Wise vs Starling Business account a comparison for the UK

Open a Starling business account

If you think Staling Bank is the best option for your company, here are some things to know before opening a business bank account.

  • You can apply for a Starling business bank account online or through their app, whether you're already a customer or not.
  • There are no monthly fees for having a Starling business bank account, which is great news for business owners who want to save money.
  • If you need help, you can contact Starling's customer support team via the app, phone or email, 24/7. That means you can get help whenever you need it, which is a big plus.
  • However, it's important to note that Starling doesn't have any physical branches. So if you prefer talking to customer support in person, Starling might not be the best fit for you.
  • Starling also offers some additional features that might be helpful for your business, such as the ability to open foreign currency accounts or access to a business toolkit for bookkeeping.

Sources used:

  1. SME loans - Small business loans - Starling Bank
  2. Starling Bank Reviews | Read Customer Service Reviews of
  3. Rates, Fees and Charges Applicable to: All GBP Business Current Accounts and GBP Sole Trader Current Accounts Effective from
  4. Apply for a business overdraft - Starling Bank

Sources last checked May 09, 2023

This publication is provided for general information purposes only and is not intended to cover every aspect of the topics with which it deals. It is not intended to amount to advice on which you should rely. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content in this publication. The information in this publication does not constitute legal, tax or other professional advice from Wise Payments Limited or its affiliates. Prior results do not guarantee a similar outcome. We make no representations, warranties or guarantees, whether express or implied, that the content in the publication is accurate, complete or up to date.

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