Tesco to compete with High Street banks

”Tesco

Supermarket giant Tesco is planning to compete with High Street banks by opening bank branches in 30 of its stores by the end of the year.

The branches are expected to be called ‘Tesco Bank’ and the supermarket hopes to take advantage of the lack of confidence in existing banks by attracting disillusioned customers.

The UK’s largest supermarket, with a 30% share of the market, already offers credit cards, savings accounts and insurance via its Tesco Personal Finance (TPF) brand and announced plans late last year that it could be offering mortgages later this year.

TPF was launched in 1997 as a joint venture between Tesco and Royal Bank of Scotland and has over 5 million customers in the UK, Ireland, Hungary and Poland. However, last summer, Tesco bought out RBS‘ 50% share in a deal worth £950 million.

The first of the branches are expected to open in April in Bristol, Blackpool and Coventry following a pilot in Glasgow. According to Andy Higginson, TPF’s chief executive, Tesco could have banks in all its branches in the future.

The announcement by the supermarket comes as bad press continues to surround the banking sector, in particular, the subject of bonuses to top executives despite the billions of pounds in bailouts by the taxpayer.

As well as banking, Tesco plans to boost its profits by offering telecoms as well as online and home shopping.

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