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Starling Bank CIO John Mountain was attracted to apply to work at the challenger bank after reading its CEO’s claim that banks shouldn’t have an IT department.
But as a coder, there were other attractions working for an app-based company that looks more like a tech firm in many ways.
Starling Bank was designed by Anne Boden, a banker with an IT background. It aims to use modern technology to make banking as convenient as possible, while enabling customers to benefit from the data they generate in their everyday lives.
Mountain is a self-proclaimed coder at heart. “I spent a lot of my career writing code at a variety of levels and at a variety of organisations, but fundamentally delivering software,” he says. He joined Starling to head up the solution architecture practice and put together a suite of banking applications.
He is now CIO, but, like the bank itself, the role is not typical.
Mountain told Computer Weekly the company doesn’t have an IT department, but rather integrates technology into everything it does.
“We don’t run a technology function here because the whole business is a tech function,” he says. “At Starling, you won’t find a team of technologists reporting to me.”
Running the bank as a technology company
Mountain has worked extensively as a contractor in the banking sector in the past, and it was this approach to IT that caught his eye when reading an article by CEO Boden.
“The reason I came to Starling in the first place is that I read an article by Anne, which says when you run a bank you don’t want to have an IT department, but rather run it as a technology company with technology in everything it does.”
All staff at Starling have some involvement in technology and that technologists are mixed into different teams. “We put hardcore technologists everywhere,” he says. “For example, we have technologists in the finance department and programmers in marketing.”
Read more about Starling Bank
- Thousands of people are downloading Starling’s app every week as the bank builds its customer base.
- Challenger bank Starling opens its API up to developers in hackathon at Google’s London Campus.
- Starling Bank founder Anne Boden relates how her time with startups outside traditional banking convinced her to build a digital bank from scratch.
- Starling Bank, which will offer smartphone-based current accounts, has been given a UK banking licence.
The “old-school model” he says, would have an IT department that ultimately reports to a board member, and it would almost be like a separate division to the banking business operation. “In many cases, there would be a physical separation with the IT operation based somewhere else. Some of the IT departments I have been in feels like you are in a different company to the banking business.”
How Starling will avoid this happening as it grows is a question Mountain keeps asking himself. “We can do it now with 120 people, but how would we sustain it as we grow?”
He says it is possible to maintain mixed teams even if a company is big, and that is traditionally how businesses ran.
“The phase of having technology as a separate function probably emerged over the last 15 years,” says Mountain. “We could avoid it by not accepting people do not have technology as a skills set. Hire people in the business who are aware of and sensitive to technology. You can also pair people up with complementary skills.”
Emulating companies in other sectors
The most exciting thing for Mountain as a technologist is how Starling Bank is emulating companies in other sectors in enabling customers to choose the services they use and benefit from their own data.
He says organisations outside the financial services sector have been enabling customers to plug into apps from third parties for complimentary services for years, but that banks have largely ignored it.
But this is changing. Starling, for example, is introducing its marketplace, and like Apple’s App Store, it will be populated by complimentary apps approved by the bank.
Starling even offers software development kits to third parties to make it easier for them to develop services for its customers. “For the most commonly used languages, we do half the work for them,” he says. “This is what companies like Apple do. They say ‘there is an API [application programming interface] but we want to go a bit richer than that’ and do some of the coding themselves.”
In fact, Mountain wants anything that is not core to the business, whether it be accounting software or a customer money management service, to be supplied while Starling’s internal team focuses on core competencies.
“We visualise our platform as a series of concentric circles, where we ask ourselves how fundamental to the business a certain piece of software is,” he says. “Everything judged to be at the core of the operation we write ourselves.
“If it’s fundamental to Starling, we are going to build it, not buy it. This includes core customer ledger, transaction processing and card processing where Starling has teams controlling it directly.”
He sees mobile apps the same way. “I can’t conceive of a world where we would outsource that activity,” says Mountain. “It has to be in this room as it is not a support function, but rather the function.”
Beyond the core, the policy is to buy where possible. “As we get to the more commodity outer layer, we tend to buy.”
For example, the bank uses a lot of software as a service as well as infrastructure as a service from Amazon and Google. “When we buy software, we never want to run it ourselves, but prefer to partner with people that provide the service,” says Mountain.
“We build and run banking software, and I want other people to run the other stuff,” he says. “I like to think the days of receiving software in a cellophane box are over.”