Tesco could capture 10% of UK financial services

by Gill Montia

Story link: Tesco could capture 10% of UK financial services

As it develops plans to become a fully-fledged retail bank, Tesco is reported to be considering fighting for a 10% share of the UK’s financial services market.

The supermarket giant gave the first indications of its banking ambitions in 2008, after becoming sole owner of Tesco Personal Finance, previously a 50/50 joint venture with Royal Bank of Scotland.

Last year, the group renamed Tesco Personal Finance as Tesco Bank and provided further evidence of the seriousness of its ambitions by announcing a partnership with the global financial technology group, Fiserv.

Tesco Bank is currently the UK’s largest supermarket bank, with over six million customer accounts across 28 financial products and services: principally, insurance, credit cards and personal loans.

According to a report in The Independent, a 10% share of the financial services market would put Tesco on a par with the recently renamed Abbey, now Santander.

The Government is encouraging new entrants into the retail banking sector and analysts suggest that brand recognition leaves supermarkets well placed to enter the full service market.