Starling enhanced its gambling block feature with a 48-hour switch-off delay

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Starling has bolstered its feature that blocks transactions with merchants associated with gambling or betting by adding a 48-hour switch-off delay, per Moneywise. Customers could previously disable the block and immediately make gambling-related transactions via their account, but now they won’t be able to do so until two days after disabling the feature. Starling said it added the delay to make the block more effective and prevent impulsive spending.

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Incumbents and neobanks alike are adding similar features as they look to strengthen their lineups of personal finance management (PFM) tools. HSBC added a self-restricting gambling block tool in November 2019. And National Australia Bank rolled out its gambling block feature earlier this year.

Competing UK neobank Monzo debuted a gambling block feature in 2018 that was in use by 140,000 of its 2 million users as of September 2019. The neobank also beta tested a “merchant block” feature to allow customers to block spending at specific retailers of their choice. 

Building out a robust set of money management tools can help neobanks satisfy demand as well as pull in more engaged customers.

• Consumers are interested in money management tools — and specific spending restrictions could be particularly attractive. Forty-five percent of mobile banking users who responded to Business Insider Intelligence’s UK Mobile Banking Competitive Edge Study (Enterprise only) said the ability to set spending limits for their credit or debit card would be “very” or “extremely” valuable. Starling’s addition of a 48-hour disablement delay could appeal to customers looking to get better control over their finances by cutting down on spending, as well as those working to kick a longer-term habit.
• A robust set of value-add features like the gambling block supports Starling’s current strategy for sustainable growth. Starling expects to break even in 2021 and aims to be the first digital bank on the stock exchange, despite being smaller in customer size (1.25 million) than competitors like Monzo (3.8 million) and Revolut (10 million). Profitability is a challenge for neobanks, making Starling’s position of nearing a breakeven point an anomaly. Offering specialized features like its enhanced gambling block could attract customers who are more engaged with Starling’s services and thus deposit greater sums with the neobank. This could ultimately push the neobank closer to its targets.

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