Starling Bank has bought accounting software start-up Ember as it seeks to weave tax and bookkeeping tools directly into its small business accounts.

The challenger lender did not reveal the price but people close to the talks said the figure was below £10 million, allowing Starling to absorb the four-year-old company without tapping external funding.

“It’s a natural complement to start offering invoicing, accounting software, tax software, alongside like traditional banking products, like credit related loans and facilities,” Declan Ferguson, Starling Bank’s chief financial officer, told Bloomberg.

The move comes ahead of new HM Revenue & Customs rules, due to take effect next year, that will force an estimated 780,000 sole traders and landlords to submit quarterly updates of income and expenses. By folding Ember’s technology into its app, Starling hopes its 500,000 small and medium-sized enterprise clients will be able to meet the fresh reporting burden without juggling separate platforms.

Founded in 2019, Ember has raised £5 million from investors including Valar Ventures. Its existing partnerships with high-street lenders such as HSBC, Lloyds Banking Group, Barclays and fintech rival Revolut will be wound down by 2026 as the software is brought entirely in-house at Starling. Around 30 Ember employees have been offered posts at the bank, while co-founders Daniel Hogan and Aaron Shaw will lead the integration, expected to finish by December.

The tie-up also signals Starling’s intent to deepen relations with business customers after the pandemic-era loan schemes accelerated its growth. Nevertheless, the lender is managing regulatory headwinds: in October it was fined £29 million for weaknesses in customer due-diligence controls and remains under a voluntary restriction from the Financial Conduct Authority.

Even as it fixes those shortcomings, the bank is exploring expansion abroad. “There is a solid opportunity to pursue a regulated business model in the US,” Ferguson said in the same Bloomberg interview, confirming talks with American advisers.

By adding integrated tax tools while pursuing overseas banking licences, Starling is betting that a broader product suite will strengthen its hand against both incumbent banks and fellow fintechs such as Tide and Revolut. The Ember acquisition could therefore mark the first step in a wider push to position the London-based lender as a one-stop finance hub for Britain’s entrepreneurs.

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