Midland Bank is set to ignite a price war in the competitive small
business sector by becoming the first bank to offer 18 months’ free
banking to start-ups.
The move, which will put pressure on the other high street banks to
follow suit, will be promoted in a pounds 2.25m marketing campaign
breaking early next week through St Luke’s.
Midland aims to boost its 15% share of the small business sector, which
lags behind NatWest, Barclays and Lloyds. NatWest leads the market with
a 26% share, followed by Barclays with about 24%.
Midland’s head of business marketing, John Collings, said traditionally
the bank had ‘dipped its toe in and out of the market. With the
recession the banks got nervous. We now realise this is a profitable
market to be in and we’re going back with renewed commitment.’
The campaign, which is backed by a 50% increase in marketing spend, will
be based on direct response ads breaking on national TV and in the