Supermarkets in a strong position to compete with banks

| May 12, 2009 | 0 Comments

According to Defaqto’s latest assessment of the banking market, supermarkets are well placed to take on High Street banks by offering a range of banking services.

Defaqto’s report, titled “Retail Banking: Challenging Times”, has established that the reputation of supermarkets means they are in a strong position to compete with High Street banks.

The report’s author, David Black, comments: “Supermarkets generally enjoy impressive customer image, brand recognition and the trust of their customers. This coupled with the fact that a member of just about every household has to physically visit a grocery store or its internet site, at least once a week cements the potential attraction.”

The report is timely after billions of pounds have been injected into banks by the taxpayer and the subject of bonuses continues to rear its ugly head and consumers lose trust in their banks.

Back in March, supermarket giant Tesco announced it was planning to compete with High Street banks by opening bank branches in 30 of its stores by the end of the year.

The supermarket said it hopes to take advantage of the lack of confidence in existing banks by attracting disillusioned customers.

Furthermore, last month Boots said it was considering a move into personal finance and banking.

Commenting on Defaqto’s report, Phil Jones of consumer group Which?, said: “Everyone goes to the supermarket anyway, so the fact that there might be a bank branch in the supermarket is going to be very attractive to a lot of people“.

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