THIS WEEK: Small business lured by Midland

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

press.

This article was first published on Marketing