Tesco Bank will close all personal current accounts by the end of November

UK retailer scales back its foray into banking

Tesco is one of a number of grocers that expanded into finance products in a bid to shake up the UK banking scene, but shrinking margins have dented plans to challenge incumbents such as Barclays and NatWest Group. Photograph:  Yui Mok/PA Wire

Tesco is one of a number of grocers that expanded into finance products in a bid to shake up the UK banking scene, but shrinking margins have dented plans to challenge incumbents such as Barclays and NatWest Group. Photograph: Yui Mok/PA Wire

 

Tesco Bank will close all personal current accounts by the end of November as its retailing parent company scales back its foray into banking. The unit of grocer Tesco Plc said just 12 per cent of its roughly 213,000 current accounts are used as a main bank account.

It stopped offering current accounts to new customers at the end of 2019. Customers can move their balances to a Tesco Bank savings account, register for the lender’s new Tesco Clubcard Pay product, apply for a credit card or move to a new current account provider, according to a statement Monday.

“With so few of our current account customers using it as their primary account we want to support them to find a suitable alternative dependent on their circumstances,” said Tesco Bank chief executive Gerry Mallon in the statement.

The supermarket still serves more than 5 million customers over a range of banking and insurance products, including credit cards and loan products, according to the statement.

Tesco is one of a number of grocers that expanded into finance products in a bid to shake up the UK banking scene, but shrinking margins have dented plans to challenge incumbents such as Barclays and NatWest Group. Tesco offloaded its mortgage portfolio to Lloyds Banking Group in 2019, and rival J Sainsbury was said to invite offers for its banking unit last year. – Bloomberg