The SME segmentation challenge
Perhaps the most important segmentation of banking services is between microbusinesses and the wider small and medium-sized enterprise (SME) population. In most developed economies, the vast majority of small businesses are microbusinesses – one- or two-person operations – while the core SME base typically employs between 10 and 100 staff.
Microbusinesses are relatively simple to serve. Their banking behaviours are highly consumer-like, meaning incumbent banks can often slot them into their retail operating models.
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