Tesco is widely tipped to be entering into the mortgage market next year. The aim is for the finance division of the supermarket to become a retail bank that can compete with high street rivals.
Tesco Bank chief executive, Benny Higgins, who joined the company last year, is hoping to capitalise upon the supermarket?s reputation of serving 15 million UK homes.
Speaking at a supermarket in Edinburgh yesterday, Mr Higgins said Tesco could be much more profitable by just selling an expanded product range to its existing customer base. He said: ?The strategy is to focus on loyal Tesco customers ? serve them well with simple, straightforward, transparent products,? according to The Scotsman.
He went on to add that Tesco Bank already has in excess of six million customers, and holds around 8 per cent of the credit card market in the UK. He reiterated his desire to introduce more products, and announced that by the end of 2010, he would be introducing mortgages, and current accounts would be introduced into the portfolio the following year.
Tesco ended its joint venture with the Royal Bank of Scotland last year, when Higgins was drafted in to expand the banking side of the supermarket giant.
In a report earlier this month, chief executive Terry Leahy said: ?We are seeing improving customer confidence and encouraging trends in both the UK and our international businesses, although recessionary conditions still exist in a number of markets.?
Tesco Bank has seen a rise in customer accounts, and a stabilisation in the rise of bad debts which the bank had experienced over the past year.
