10 February 2016

Tesco Bank opens seven millionth customer account; current accounts to come in H1

18 February 2014  |  6087 views  |  0 Tesco Bank

UK supermarket chain Tesco is preparing to step up its assault on the UK banking sector with the launch of its first current account product later this year.

Tesco Bank currently offers a range of retail banking and insurance products and has just signed its seven millionth customer account.

Since Tesco took full ownership from joint venture partner Royal Bank of Scotland in 2008, the bank has added an extra 1.2 million customer accounts, launching a range of new products including mortgages, ISAs and Box Insurance.

During this period, deposits grew by 58% and customer lending increased by 64%.

Today, one in eight credit card transactions in the UK is made with a Tesco Bank Clubcard Credit Card.

The bank also has a strong Web presence, with 86% of transactions completed online.

Tesco says the current account launch in H1 2014 will be the "final strategic building block" in its plans to offer a full range of the core retail banking services.

Rival supermarket chain Sainsbury's is also stepping up its investment in its banking arm, with plans to recruit an extra 80 people in Edinburgh to add to its HQ headcount of 320.

Last week, Sainsbury's published the results of research of over 4000 people which indicated that 55% are considering taking out a banking or insurance product over the next 12 months, or switching to another provider. Of those, 38% - or about 9.8 million people - are considering taking out a new banking or insurance product from supermarket banks.

While Sainsbury's has no plans as yet to offer a current account service, Tesco's launch is set to coincide with the first current account from Virgin Money. The banking arm of the Branson conglomerate is currently inviting customers to pre-register their interest in switching from a traditional high street bank, as it prepares to launch its own current account product in the near future.

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