Starling ripping off their best customers

DaveBurnley

My wife uses a Starling current account. From Feb 15 it will no longer pay any interest at all, but they have introduced an Easy Saver account which does. On the app she tried many times to apply for this but it kept saying she was "ineligible". Recently the application seemed to progress a bit further to being reviewed. However after a couple of days waiting, the application was declined due to "constraints". We have tried this a couple more times, same result but quicker. We have friends who successfully opened Starling Easy Saver accounts with credit balances of a few hundred pound in their current accounts. My wife is a loyal customer of several years with an average current account balance of around £5k. Sounds like the account changes and these "constraints" are designed to stop paying any interest at all to their best customers. 

gt94sss2

It's more likely related to https://www.fca.org.uk/news/press-releases/fca-fines-starling-bank-failings-financial-crime-systems-and-controls

However, Starling may have done your wife a favour as there are plenty of other savings accounts paying more than 4%.

Hoenir

 DaveBurnley said:

 Sounds like the account changes and these "constraints" are designed to stop paying any interest at all to their best customers. 

Starling have recently been heavily fined for financial crime failings related to its financial sanctions screening. It also repeatedly breached a requirement not to open accounts for high-risk customers.  

Safe to assume that as a consequence internally Starling will be administratively stretched. As they attempt to bring all customer records in line with regulatory requirements. Also introducing far better systems of internal control. 

Your wife is simply unavoidable collateral damage at the current time. 

Desmond_Hume

Keeping £5K in a current account is bonkers when there are a plethora of higher interesting earning, instant access savings accounts available. 

For me, my current account has enough to cover bills plus some float.

Hazzanet

I have to say that timing and handling of this by Starling is rather poor. 

They decide to withdraw interest on current accounts and in the same breath introduce a savings account with 4% interest.  It's only natural that those who have balances in their current accounts are going to want to explore the new savings account.

However, there are "constraints" on Starling's ability to offer these new accounts determined by unpublished and opaque internal criteria.  They then roll the apply button out to everyone (even those that don't meet the criteria) and "decline" those that don't meet it.  

Human nature is to be disappointed and lose faith in the bank when they're unclear on why a savings account has been declined, leading to widespread customer dissatisfaction.  

I do think it could have been handled so much better:

• They could have held the current account interest cut back until they had overcome their "constraints" on the savings account. 
• They could have phased the rollout of the new account based on eligibility and called it a beta test.  
• They could have just reduced the interest rate on the current account and not bothered with the easy saver.  

I work in finance so I understand the "bank doesn't have to have you as a customer", "they don't need to tell you why they declined" and "there's better rates elsewhere" arguments. 

The fact of the matter is that customer expectations have not been managed well at all here leading to negative sentiment for a bank that, in the past, I've really only heard positive things.  

penners324

Given the way Starling launched the interest on the standard current account, has now withdrawn it and is severely limiting the savings accounts it opens, I'm inclined to agree.

Not a good look for the bank

DaveBurnley

Hazzanet said:

I have to say that timing and handling of this by Starling is rather poor. 

They decide to withdraw interest on current accounts and in the same breath introduce a savings account with 4% interest.  It's only natural that those who have balances in their current accounts are going to want to explore the new savings account.

However, there are "constraints" on Starling's ability to offer these new accounts determined by unpublished and opaque internal criteria.  They then roll the apply button out to everyone (even those that don't meet the criteria) and "decline" those that don't meet it.  

Human nature is to be disappointed and lose faith in the bank when they're unclear on why a savings account has been declined, leading to widespread customer dissatisfaction.  

I do think it could have been handled so much better:

• They could have held the current account interest cut back until they had overcome their "constraints" on the savings account. 
• They could have phased the rollout of the new account based on eligibility and called it a beta test.  
• They could have just reduced the interest rate on the current account and not bothered with the easy saver.  

I work in finance so I understand the "bank doesn't have to have you as a customer", "they don't need to tell you why they declined" and "there's better rates elsewhere" arguments. 

The fact of the matter is that customer expectations have not been managed well at all here leading to negative sentiment for a bank that, in the past, I've really only heard positive things.  

Thanx for your detailed reply Hazzanet. However " (even those that don't meet the criteria) and "decline" those that don't meet it ", I can assure you that there can be no financial criteria that she does not meet. So unless it is down to staffing or IT issues (which they could have explained), I do believe this is unethical business practice, something that the the MSE team should address.

wiseonesomeofthetime

Why would the MSE team address it?

They cannot influence Starling's policy, surely 🤷‍♂️

Hoenir

wiseonesomeofthetime said:

Why would the MSE team address it?

They cannot influence Starling's policy, surely 🤷‍♂️

The FCA certainly are !  The severity of the current situation has without doubt put the board along with the management team under intense pressure and scrutiny. Wouldn't be surprised to see the bank taken over. Given the knock to it's credibility. 

wiseonesomeofthetime

Hoenir said:

wiseonesomeofthetime said:

Why would the MSE team address it?

They cannot influence Starling's policy, surely 🤷‍♂️

The FCA certainly are !  The severity of the current situation has without doubt put the board along with the management team under intense pressure and scrutiny. Wouldn't be surprised to see the bank taken over. Given the knock to it's credibility. 

Yeah, however, the FCA are not the MSE team, which is who the OP wanted to address the issue.

TheBanker

DaveBurnley said:

My wife uses a Starling current account. From Feb 15 it will no longer pay any interest at all, but they have introduced an Easy Saver account which does. On the app she tried many times to apply for this but it kept saying she was "ineligible". Recently the application seemed to progress a bit further to being reviewed. However after a couple of days waiting, the application was declined due to "constraints". We have tried this a couple more times, same result but quicker. We have friends who successfully opened Starling Easy Saver accounts with credit balances of a few hundred pound in their current accounts. My wife is a loyal customer of several years with an average current account balance of around £5k. Sounds like the account changes and these "constraints" are designed to stop paying any interest at all to their best customers. 

Has your wife asked Starling what she needs to do to remove the constraints? They probably need updated Know Your Customer information (similar to how other banks have been asking customers to confirm their source of funds, income etc - there are many threads about these requests on this board). Asking Starling might result in a quicker resolution than appealing to the MSE Team.