Tesco to open 30 in-store banks

by Gill Montia

Story link: Tesco to open 30 in-store banks

Tesco is proposing to open bank branches in 30 of its stores, by the end of this year.

The supermarket giant first indicated its ambitions in the banking sector in July of last year, after it became sole owner of Tesco Personal Finance (TPF), previously a 50/50 joint venture with Royal Bank of Scotland.

TPF already offers credit cards plus savings and insurance products and initially the new banking arm (likely to be called Tesco Bank) will focus on these areas of the market.

However, the retailer has plans to launch a current account in late 2010 and possibly expand into mortgages in the years ahead.

A pilot is being run in Glasgow and should be followed by in-house branch openings in Bristol, Blackpool and Coventry, during April.

The new venture aims to capitalise on the current disaffection with High Street banks and it is understood that banking customers will be able to accrue Tesco Clubcard points.

The group’s chief executive, Sir Terry Leahy, is convinced that services can potentially provide a larger and faster growing market than food.

In the case of TPF, he is predicting that the unit could boost the group’s profits by £1 billion a year at some point in the future.