Tide vs Starling: Comparing business bank accounts

Tide vs Starling: Comparing business bank accounts

A bit of background

Before 2008, the term ‘Challenger Bank’ didn’t form part of anyone’s vocabulary. The business banking industry was dominated by the ‘big four’ High Street banks of HSBC, Barclays, NatWest, and Lloyds Banking Group and this had been the case for many years. Then came the global financial crash of 2008 and everything changed.

After spending £500 billion on a rescue package to help stabilise the UK banking system and restore market confidence, both regulators and the government were anxious to put measures in place to prevent such a crisis from ever occurring again. A key part of this strategy was to encourage more competition in the banking sector to reduce the dominance of the big banks in the market. With the levelling of the playing field, opportunities were also opened up for entrepreneurs to bring a digital revolution to the banking space. Not only did this bring growth in new technology, but a move away from the traditional High Street banking model, and the birth of the Challenger Banks.

So much more than a business bank account
At Tide, we support those who work for themselves. When you become a Tide member, you don’t just get a business account, but access to our business finance platform saving you time with your admin. You can register your company for free and get a virtual office address all in one go. And, once you’re up and running, you can easily send invoices, track your expenses, add expense cards for your team and let Cashflow Insights help you stay cash flow positive.
Say goodbye to spreadsheets and get started with a free business bank account today 🚀

What are the challenger banks?

The challengers are new, smaller banks created to compete with the main High Street banks by using digital financial practices. Many of them have turned away from the traditional branch approach and operate through a mobile app or online-only banking. Although not regulated as a bank, Tide is regulated by the FCA and our ClearBank-provided bank accounts have FSCS protection. We are also one of the leading providers of digital business banking services in the UK.

In this article, we will compare and explain the products and services on offer from both Tide and Starling Bank.

Table of contents

Tide vs Starling: the similarities

Feature Tide Starling
Cash deposits ✔️ ✔️
Mobile and online banking ✔️ ✔️
Freeze/unfreeze card in the app ✔️ ✔️
Additional cards for employees ✔️
Accountancy software integration ✔️ ✔️
Scheduled payments ✔️ ✔️
Apple Pay ✔️ ✔️
information correct as of September 2021

If you’re a sole trader, freelancer, or have set up your own limited company, there is now a wide choice of providers offering business bank accounts. Both Tide and Starling offer free business bank accounts that can be accessed and used via a mobile banking app. All their accounts offer payment cards and they both easily integrate with a host of popular accounting software, such as Xero, Sage, and QuickBooks. Accounts are also opened online and managed digitally, as neither Tide nor Starling has a branch network. But, there are differences too and we will explore the features that set them apart from each other.

Tide vs Starling: how much do accounts cost?

Feature Tide Starling
Monthly account charge Free Free
Transfers costs Free between Tide accounts Free between Starling accounts
Fee for cash deposits £2.50 for deposits up to £500
or 0.5% of cash amount for deposits over £500 (at Post Offices)
3% (at PayPoints)
0.3% or £3 minimum (at Post Offices)
Fee for payments in or out 20p each Free
Fee for Direct Debits 20p each Free
Fee for replacement cards Free £5
information correct as of September 2021

Firstly, it’s free to open a Tide account and there’s no monthly fee for the entry-level business account. There are also no transaction fees to transfer money between Tide accounts. Transfers in or out of your account cost 20p. International transfers will be coming soon for Tide accounts.

Like Tide, there is also no monthly fee with a Starling business account. Starling won’t make charges for electronic payments (such as direct debits and standing orders), or for domestic transfers and cheque deposits. When it comes to going abroad, neither Tide nor Starling makes any charge for overseas spending.

Tide vs Starling: Add-ons and paid plans

Starling Business Toolkit

Both Tide and Starling offer paid add-ons or bundles which provide extra features to complement your account. Starling offers The Business Toolkit for a charge of £7 per month, including VAT. This provides additional functionality, including the ability to create, send and match invoices electronically, as well as a facility to upload receipts from the app. The Business Toolkit will also automatically categorise your expenses too, as well as calculate an estimate of your self-employed tax return using cash accounting. You can also record VAT on your transactions and connect to HMRC to submit your returns.

Tide Invoice Assistant

When it comes to keeping your finances in order, Tide accounts have a great free feature that lets you categorise and tag your expenses so you can see at a glance what you’ve spent. Nor is there any charge for creating and sending invoices electronically. For £10 + VAT per month, you can opt to upgrade to Tide’s Invoice Assistant bundle. This will give you automated matching and payment of invoices, as well as automatic chasing of invoices, as well as 2 free Direct Debits per month too.

Tide Plus and Cashback Plans

Tide also offers the option to upgrade your account, as your business grows. For £9.99 per month + VAT, Tide Plus provides telephone support, a 24/7 legal helpline as well as up to 20 free transfers in and out. You also get a free company expense card, which you can use to manage your company expenditure. At £49.99 per month + VAT, Tide Cashback is ideal for established businesses. As well as a dedicated account manager, you also receive 150 free transfers per month, 0.5% cashback on all spend on your Tide card, as well as 3 company expense cards.

Tide vs Starling: how easy is it to pay in cash?

If you need to deposit cash, then this can be done at a Post Office with both Tide and Starling. With Tide, the charge is £2.50 for deposits up to £500 or 0.5% of the cash amount for deposits over £500. This fee is £3 for up to £1000 with Starling. If you want to deposit more than £1000 at a Post Office with Starling, then this will attract a fee of 0.3% of the total amount being deposited. You can also use PayPoints with a Tide account with a fee of 3%. How easy is it to open a business bank account with Tide vs Starling?

Tide vs Starling: how easy is it to open a business bank account?

When it comes to deciding to open a bank account for your business, both Tide and Starling have got it covered.

Feature Tide Starling
Apply through the app ✔️ ✔️
Speedy sign-up process ✔️ ✔️
Credit check
Card delivery fee Free Free
Card delivery time 2-5- working days 3-5 working days

Tide account sign-up

To set up a Tide business account, you’ll first need to download the Tide app from either the App Store or Google Play Store. You then need to provide a form of ID: either a driving licence, passport, or European National ID card. You may also be asked to provide evidence that your business is already up and running, such as HMRC registration, signed contracts, or qualifications. The Tide pledge is that 53% of new business customers open their accounts in under 10 minutes, 70% in under 60 minutes, and 81% within 48 hours. You won’t be subjected to a hard credit check and your accompanying bank card will be supplied for free. If you lose your card, there’s no fee to order a replacement.

Starling account sign-up

The process to set up a Starling business account is very similar to opening a bank account with Tide. You’ll first need to download the Starling app and provide at least one of the following documents to verify your identity: your passport, EU/EEA ID card, UK residence card, or UK photo driving licence (full or provisional). As with Tide, you may also be asked to provide evidence to confirm the nature of your business. These may include invoices, bank statements, letters from accountants, signed contracts, or payslips. Starling affirms that the account application process can take as little as 10 minutes. Like Tide, Starling doesn’t conduct a hard credit check, and the account’s accompanying bank card is free to receive but costs £5 to replace in the UK.

Tide vs Starling: using your card in the UK and abroad

Feature Tide Starling
Free transactions abroad Unlimited Unlimited
Free ATM withdrawals abroad No, £1 each Unlimited
information correct as of September 2021

Both Tide and Starling offer free card transactions when spending in the UK, as well as a contactless card limit of £45. You can also withdraw cash at ATMs with Starling and Tide.

If you travel abroad, then you can use your Tide card to spend at any retailer or outlet where Mastercard is accepted. You’ll also receive the Mastercard exchange rate with no additional mark-up or fees. Unlike many other digital or High Street banks, there is no charge if you withdraw over a certain limit. However, you will still be charged £1 to withdraw cash at an ATM (the same charge as applies in the UK).

You can also enjoy free international spending with no limits with your Starling card. Like Tide, the Mastercard exchange rate will also apply with no extra fees. If you use a foreign ATM to take out cash, then there is also no withdrawal fee.

Tide vs Starling: the all-important customer support

Feature Tide Starling
Customer service via the app ✔️ ✔️
Telephone customer service ✔️ ✔️

Account-holders with a free Tide account can contact Tide Member Support through the app. You can also send Tide an email with their contact number and request a call back from the Member Support team during working hours. There is also an automated telephone service to report a lost or stolen card. For members on the Tide Plus or Cashback plans, there is access to telephone support, as well as a 24/7 legal helpline to assist with any tax or contractual issues.

At Starling, there is 24/7 support available from customer service advisers, through the in-app chat, over email, and via telephone.

Tide vs Starling in conclusion: similar but different

On paper, there are many similarities with the business bank accounts on offer from both Tide and Starling. They are both digital accounts, which you can manage from the convenience of an app. You can open a business bank account for free with no monthly charges with both Tide and Starling. The respective apps offer a host of smart features and you can upgrade with additional features or bundles to suit your business needs. However, while Starling also offers savings and personal bank accounts, Tide is solely focused on the needs of start-ups with its mission of saving small businesses time and money. From company formation, VAT registration and setting up a virtual office address, to invoicing, expense management and managing your cash flow, Tide is there to support businesses every step of the way.

Join the Tide community 👷‍♀️👨🏽‍🍳

350,000 fellow business owners, just like you, already love our features:

✔️ Register your business for free

✔️ Open a free business bank account with no monthly fees

✔️ Create and send free customised invoices

✔️ Predict your cash flow and improve your credit score

✔️ Unlock exclusive member perks and discounts

✔️ Get 24/7 legal support with Tide Plus and Cashback

Open your business account with Tide today 🚀

Sources used for this article

  1. Wikipedia – Starling Bank
  2. Wikipedia – Challenger Banks
  3. Wikipedia – Financial Crash 2008
  4. Tide blog: e-money vs bank accounts: How Tide keeps your money safe
  5. Starling website: https://help.starlingbank.com/hc/en-us/

All sources checked as of 12th July 2021

Caroline Wire

Caroline Wire

Senior Small Business Copywriter

Subscribe to our FREE business tips newsletter

    By subscribing you agree to receive marketing communications from Tide.
    You can unsubscribe anytime using the link in the footer of any of our emails.
    See our privacy policy.

    Thanks for signing up.

    Related Articles

    Image of Tide card

    A business bank account that's free, easy to open, and helps you start doing what you love.

    Tide is about doing what you love. That’s why we’re trusted by 450,000+ sole traders, freelancers and limited companies throughout the UK.

    Open an account
    Image of App Store 4.7, 27k
    Image of Google Play 4.6, 3.7k