Starling Bank has become the latest digital challenger bank to make changes to its account charges.

Following Monzo's move earlier this week to implement a three per cent charge for ATM withdrawals amounting to over £250 per month and a £5 fee for replacing lost cards, Starling is also adding a £5 fee for replacing lost cards, along with a monthly £2 charge for new children's cards and the Connected card for vulnerable users.

"The charge will not affect existing card users," explained Starling. "It is a monthly fee of £2 which will cover the costs of providing customers with the additional service and support us in meeting the cost of running the business sustainably."

Current account users who open an additional GBP account will also incur the £2 per month charge, while account holders who choose to make payments through Chaps will now be charged £20 per payment.

A statement from Starling added that in line with interest rates across the Eurozone, from 1 November, Starling will introduce a -0.5% AER charge on deposits over €50,000 for its Euro Business Account customers.

The fee changes are being reflected across the UK's challenger banks, which are now cutting down on unsustainable initial charging models in a drive to cut costs and move to profitability.

Starling has previously promised to hit break even by the end of 2020.

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