SOUTHAMPTON employer Starling Bank aims to overtake Barclays in the business banking market within five years, its boss has said.

The digital bank has 320 staff based in the city, a net increase of 100 this year.

It is planning to expand further in Southampton next year and says this will be driven by the expansion of its technology team.

The digital bank – which chose Town Quay as its first base outside London in 2019 – is also gearing up to float on the stock market.

Its founder and chief executive, Anne Boden, told the PA news agency that five years was a “very realistic” timescale to surpass the “big five” player Barclays and more than double its seven per cent share of the small business market.

In an updated paperback edition of her book, Banking On It, Ms Boden said she no longer considered the likes of Monzo – set up by Starling co-founder Tom Blomfield – as her direct competition.

“The extraordinary experiences of the year 2020 made it clearer than ever that our competitors are now Lloyds, Barclays et al,” she wrote.

Barclays, which she said has around a 15 per cent share of the market, is “now in our sights”, she added in the new chapter.

In less than 18 months, Starling has more than doubled its small business market share from three per cent in June last year, thanks in large part to its move to lend under the government’s emergency coronavirus loan scheme.

It has amassed more than 413,000 small business customers and lent around £2billion.

Ms Boden said Starling was no longer a challenger, but a mainstream player that is “taking on the big banks”.

“We see a world where we are growing substantial market share and people will be saying ‘NatWest, HSBC and Starling’,” she said.

“I think we’ll get to that market penetration and people will see us as the same size,” she added.

The group’s rise in the small business market has reportedly attracted the attentions of various suitors, such as Lloyds Banking Group and JPMorgan Chase.

But Ms Boden – who founded the bank in 2014 – dismissed talk of a sale and said the group was firmly focused on a flotation in one to two years’ time.

The bank broke even in October last year and remained profitable for the following 11 months.

It is now heading for Europe, targeting France initially with its “embedded finance” offering – enabling non-financial players such as retailers to offer banking services.