Tesco Personal Finance

Tesco Personal Finance Ltd

Type	Private
Founded	1997
Headquarters	Edinburgh, Scotland, United Kingdom
Key people	Benny Higgins CEO
Industry	Finance and insurance
Products	Consumer financial services
Total assets	£8.156 billion (31 December 2007)
Employees	200 at head office (2008)
Parent	100% Tesco
Subsidiaries	Tesco Compare
Website	tescofinance.com
Tesco purchase of RBS stake completed 2008Q4

Tesco Personal Finance (trading as Tesco Finance & Insurance) [1] is a telephone and internet based commercial bank in the United Kingdom owned by Tesco, the UK's largest supermarket. Until 2008 it was a 50:50 joint venture between Tesco and the Royal Bank of Scotland, one the UK's largest banks. It is registered in Scotland at St. Andrew's Square, Edinburgh.

Prior to the formation of TPF, Tesco had a banking joint venture with NatWest, which ended in February 1997. Tesco Personal Finance was formed in July 1997 following the successful launch of Sainsbury's Bank by its main UK competitor, J Sainsbury plc Sainsbury's. The bank was launched as a joint venture with the Royal Bank of Scotland, which processed all its financial transactions. Subsidiary companies of the Royal Bank, such as Direct Line, UKI and Lombard Direct helped Tesco Personal Finance provide insurance products.

Tesco Personal Finance has been a great success for both Tesco and the Royal Bank of Scotland, returning profits of £65 million for Tesco for the financial year to February 2007. Tesco is able to use its large customer base to cross sell financial services products, and allows customers to accumulate Tesco Clubcard points when they purchase finance products. This strategy is highly effective because it can be combined with in store offers which results in customers spending higher amounts of money, often on non-food items inorder to increase sales across all product lines thus causing sustainable yet competitive growth which allows them to deal with control for market control with ASDA.

The company is currently trialling a finance centre in the Glasgow Silverburn Extra store providing free financial advice and quotes for insurance and loans, this service is staffed by trained Royal Bank of Scotland staff. The centre also has a Euro cash machine providing commission free Euros and a Bureau de Change run by Travelex. If successful this trial will roll out to a number of other key and flagship stores.

In July 2008, Tesco announced that they were buying out the Royal Bank of Scotland's 50% stake in the company for £950 million, and the transaction was completed later that year.^{[1] [2]}

During 2009 Tesco plan to open 30 branches in store, likely to be branded Tesco Bank. The products have always been promoted in store with posters and leaflets (the low cost of advertising in existing premises is one of the main competitive advantages of a retailer-owned financial services company), but these direct customers to contact Tesco Financial Services by post, phone or via the internet. The company is considering adding mortgages and current accounts to its product range, perhaps before the end of 2010. ^[3]

References

External links

• Tesco Personal Finance
• Tesco Personal Finance Ireland

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