Comparing the UK’s best challenger banks – a guide to choosing the right option for your business

Last updated on 22 March 2024

Looking for the best challenger banks in the UK? In the dynamic world of finance, traditional banks are no longer the only option for businesses seeking banking services.

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The rise of challenger banks has revolutionised the financial landscape, offering innovative solutions, seamless digital experiences, and competitive offerings.

As a UK business owner, selecting the right challenger bank for your needs can be a crucial decision. This article will explore the top challenger banks in the UK and provide essential guidance on how to choose the best one for your business.

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Comparing challenger banks

Challenger BankFeaturesFees and PricingUser ExperienceIntegrationSecurityCustomer Support
Revolut– Multi-currency accounts
– Expense management tools
– Prepaid business cards
– Competitive FX rates
– Free tier available
– Paid plans with additional features
– User-friendly digital platform
– Mobile app
– Real-time notifications
– Integrations with accounting software– Two-factor authentication
– Encryption
– Responsive customer support
Starling Bank– Business current accounts
– Debit cards
– Real-time notifications
– Integrations with accounting software
– Free tier available
– Paid plans with additional features
– Intuitive mobile app
– User-friendly interface
– Integrations with accounting software– Two-factor authentication
– Encryption
– Exceptional customer service
Monzo– Seamless expense management
– Instant notifications
– Integration with accounting software
– Free tier available
– Paid plans with additional features
– User-friendly mobile app
– Easy-to-use tools
– Integration with popular accounting software– Two-factor authentication
– Encryption
– Responsive customer support
Tide– Quick business account opening
– Multiple accounts
– Automatic bookkeeping integrations
– In-app invoice creation and tracking
– Free tier available
– Paid plans with additional features
– Easy-to-use digital platform
– Mobile app
– Automatic bookkeeping integrations– Two-factor authentication
– Encryption
– Timely customer support
Wise (formerly TransferWise)– Multi-currency accounts
– Competitive exchange rates
– Tools for cross-border transactions
– Free tier available
– Paid plans with additional features
– User-friendly digital platform
– Easy money transfers
– Integration with accounting software and payment processors– Two-factor authentication
– Encryption
– Responsive customer support
Best challenger banks UK

Please note that the information provided in the table is subject to change, and it’s always recommended to visit the respective challenger bank’s website for the most up-to-date details on their features, fees, and services.

Best challenger bank statistics

Challenger banks in the UK have seen substantial growth:

  • The number of UK-based challenger banks has more than doubled in the past five years, reaching over 70 by 2021.
  • As of 2021, challenger banks collectively held around 15% of the UK’s personal and business current account market.
  • In 2020, Monzo reported having over 5 million customers, Revolut had over 13 million, Starling Bank surpassed 2 million, and Wise had more than 10 million customers globally.

Increased adoption of digital banking solutions:

  • A survey conducted in 2020 revealed that 71% of UK consumers used mobile banking apps, highlighting the growing popularity of digital banking.
  • The COVID-19 pandemic has accelerated the adoption of digital banking, with an increase in online transactions and remote banking services.

Shifting preferences of SMEs towards challenger banks:

  • According to a 2020 survey by YouGov, 48% of UK SMEs would consider switching to a challenger bank, citing reasons such as better customer experience, cost savings, and enhanced features.

Funding and valuation of challenger banks:

  • Revolut, one of the leading challenger banks, raised $800 million in a funding round in 2020, valuing the company at $33 billion.
  • Starling Bank raised £272 million in a funding round in 2021, valuing the company at £1.1 billion.
  • Monzo raised £50 million in a funding round in 2020, valuing the company at £1.25 billion.

Customer satisfaction and loyalty:

  • In a 2020 survey conducted by Which?, Starling Bank and Monzo ranked among the top banks for customer satisfaction, with scores of 88% and 84% respectively.
  • Research conducted by Smart Money People in 2021 indicated that challenger banks generally enjoy higher customer satisfaction ratings compared to traditional banks.

These statistics and data points provide insights into the growth, adoption, and customer perception of challenger banks in the UK. They reflect the increasing popularity and relevance of these banks in the financial landscape, particularly among consumers and SMEs.

Best challenger banks UK


Revolut is a leading UK-based challenger bank known for its user-friendly digital platform and a broad range of features tailored for businesses.

With Revolut Business, you can access multi-currency accounts, expense management tools, prepaid business cards, and competitive foreign exchange rates.

Furthermore, Revolut offers additional services such as business loans and merchant acquiring solutions, making it a comprehensive financial solution for SMEs.


  • Multi-currency accounts for easy international transactions.
  • Expense management tools streamline financial tracking.
  • Prepaid business cards offer convenient spending control.
  • Competitive foreign exchange rates.
  • Additional services like business loans and merchant acquiring solutions.


  • Some features are only available in paid plans.
  • Customer support can be occasionally slow in response times.

Starling Bank

Starling Bank has gained significant popularity as a digital-only bank that caters to both personal and business customers.

Their business offering includes current accounts, debit cards, real-time notifications, and integrations with accounting software like Xero.

Starling Bank is also known for its exceptional customer service and intuitive mobile app, making it a favorite among entrepreneurs and freelancers.


  • Business current accounts with useful features.
  • Real-time notifications keep you updated on transactions.
  • Integrations with popular accounting software like Xero.
  • Exceptional customer service with responsive support.
  • Intuitive mobile app and user-friendly interface.


  • Limited branch access due to being a digital-only bank.
  • Some users have reported occasional technical glitches.


Monzo is a challenger bank that puts user experience at the forefront.

Their business accounts offer an array of features, including seamless expense management, instant notifications, and integration with popular accounting software.

Monzo’s “Pots” feature allows you to set money aside for specific purposes, making budgeting and financial planning more straightforward for businesses.


  • Seamless expense management simplifies tracking.
  • Instant notifications keep you informed about transactions.
  • Integration with accounting software for easier financial management.
  • User-friendly mobile app and easy-to-use tools.
  • Strong community and active user base.


  • Limited international capabilities for businesses operating globally.
  • Certain advanced features are only available in paid plans.


Tide is a digital banking platform exclusively focused on serving small businesses.

With Tide, you can open a business account quickly, access multiple accounts, set up automatic bookkeeping integrations, and even apply for loans.

One of Tide’s standout features is its in-app invoice creation and tracking, enabling businesses to manage their finances more efficiently.


  • Quick and easy business account opening process.
  • Multiple accounts to manage various financial needs.
  • Automatic bookkeeping integrations streamline accounting processes.
  • In-app invoice creation and tracking features.
  • Responsive customer support.


  • Limited lending options compared to some other challenger banks.
  • Some users have reported occasional delays in transactions.

Wise (formerly TransferWise)

Wise is renowned for its international money transfer services, but it also offers a multi-currency account for businesses.

With Wise Business, you can hold and manage money in multiple currencies, receive payments from abroad, and enjoy competitive exchange rates.

Wise also provides a suite of tools to streamline cross-border transactions, making it an excellent choice for businesses with global aspirations.


  • Multi-currency accounts for easy global transactions.
  • Competitive exchange rates and transparent fees.
  • Tools for cross-border transactions simplify international payments.
  • Integration with accounting software and payment processors.
  • Strong reputation and established track record.


  • Limited lending options for businesses in comparison to traditional banks.
  • The focus on international services may not be suitable for all businesses.

How to choose the best challenger bank for your business

How to choose the best challenger bank

  1. Assess your business needs

    Consider the specific banking services your business requires, such as multi-currency accounts, payment processing, or business loans. Understanding your needs will help you identify which challenger bank aligns best with your requirements.

  2. Evaluate fees and pricing

    Compare the fee structures of different challenger banks, including transaction fees, currency conversion charges, and monthly account fees. Ensure that the pricing is competitive and suitable for your business’s transaction volume and financial goals.

  3. User experience and interface

    A user-friendly interface and intuitive mobile app can greatly enhance your banking experience. Look for a challenger bank that offers a seamless digital platform, easy-to-use tools, and convenient features like real-time notifications.

  4. Integration with other tools

    Consider the integration capabilities of the challenger bank with popular accounting software, payment processors, or other business tools you use. Seamless integration can streamline your financial operations and reduce manual work.

  5. Security and regulation

    Prioritise the security measures and regulatory compliance of the challenger bank. Look for banks that are authorised by the Financial Conduct Authority (FCA) and provide robust security features, such as two-factor authentication and encryption.

  6. Customer support

    Assess the quality and availability of customer support services. Timely and efficient support can be crucial, especially when you encounter issues or have questions regarding your business account. Look for challenger banks that offer responsive customer support through multiple channels, such as phone, email, or live chat.

  7. Reputation and trustworthiness

    Consider the reputation and track record of the challenger bank. Research online reviews and customer feedback to gauge the experiences of other businesses. Additionally, look into the financial stability of the bank and its adherence to industry standards and regulations.

  8. Scalability and future growth

    Evaluate whether the challenger bank can accommodate your business’s growth plans. Consider factors such as account limits, lending options, and additional services that may be essential as your business expands.

  9. Peer recommendations and networking

    Seek advice from other business owners or industry professionals who have experience with challenger banks. Their insights and recommendations can provide valuable guidance in choosing the right bank for your business.


Challenger banks have disrupted the traditional banking landscape in the UK, offering innovative and convenient solutions tailored to the needs of businesses.

When selecting the best challenger bank for your business, take into account factors such as the specific services required, pricing, user experience, integration capabilities, security, customer support, reputation, scalability, and peer recommendations.

By carefully assessing these aspects, you can make an informed decision that aligns with your business goals and provides a seamless banking experience.

Remember, choosing the right challenger bank can positively impact your financial operations, streamline processes, and ultimately contribute to the growth and success of your business.

Best challenger bank – FAQ

Are challenger banks regulated and safe to use?

Yes, most challenger banks in the UK are regulated by the Financial Conduct Authority (FCA), which ensures they adhere to industry standards and regulations. These banks also implement robust security measures, such as encryption and two-factor authentication, to protect customer data and transactions.

Can I get a business loan from a challenger bank?

Yes, many challenger banks offer business loan options. However, the availability and terms of loans may vary between banks. It’s advisable to review the specific loan offerings of each bank and assess whether they meet your business’s financing needs.

Can I deposit cash or cheques with a challenger bank?

Challenger banks, being primarily digital-focused, may have limited options for cash and cheque deposits. Some banks offer partnerships with third-party providers or provide alternative solutions such as depositing cash at select locations. It’s important to check the deposit options available with each challenger bank.

Do challenger banks offer business credit cards?

Some challenger banks do offer business credit cards as part of their services. These credit cards may come with various features, rewards, and expense management tools tailored to businesses. Review the offerings of each bank to determine if they align with your business’s requirements.

Can I integrate challenger bank accounts with accounting software?

Yes, many challenger banks offer integration capabilities with popular accounting software such as Xero, QuickBooks, or FreeAgent. This integration can streamline financial management by automating transaction data syncing and simplifying reconciliations. Check the integration options available with each bank to ensure compatibility with your preferred accounting software.

Are challenger banks suitable for large businesses or corporate entities?

While challenger banks primarily target SMEs and individuals, some are expanding their services to cater to larger businesses and corporate entities. However, it’s important to assess whether the specific features, account limits, and services offered by each bank meet the requirements of larger businesses before making a decision.

Can I switch back to a traditional bank if I am not satisfied with a challenger bank?

Yes, you can switch back to a traditional bank if you find that a challenger bank does not meet your needs. However, it’s advisable to review the terms and conditions of the challenger bank and consider any potential fees or processes involved in switching back to a traditional bank.

Remember, when considering a challenger bank for your business, it’s important to thoroughly research their offerings, compare features, and assess how well they align with your specific requirements before making a decision.

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Reviewed by , Managing Director


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