The Finance Owl

Banks – Loans – Mortgages – Money



Tesco BankTesco Bank is a commercial internet-based bank in the UK. The bank is owned by Tesco, the one of the largest supermarket chains within the United Kingdom and it was founded in 2007. Tesco Bank is headquartered in Edinburgh, Scotland, and employs about 450 people.

Until Tesco Bank was founded in 1997, Tesco had been affiliated with NatWest Bank, alarge UK bank, for a joint venture.

Tesco Bank and Customers

Since Tesco Bank is owned by Tesco, the bank’s financial services are exposed to Tesco’s large customer base. This strategy has proven to be very successful, allowing customers to tie in their purchases at Tesco to contribute to rewards at the Tesco Bank, which tempts Tesco Customers to spend more money.

The formation and launch of Tesco Bank was to compete with its main supermarket competitor (Sainsbury’s) launching the Sainsbury’s Bank. All of the financial transactions were processed by the Royal Bank of Scotland, one of the largest banks in the United Kingdom. All subsidiary companies underneath the Royal Bank of Scotland (i.e. Direct Line, Lombard Direct, and UKI) all contributed to the personal finance services of Tesco Bank. The company has been very successful, returning 65 billion pounds worth of profits in its first year of business for Tesco and the Royal Bank of Scotland.

Prior to 2008, Tesco and the Royal Bank of Scotland had a 50:50 profit share of Tesco Bank. But, in July of that year, Tesco announced its plans to purchase the Royal Bank of Scotland’s 50% share for £950 million.


Since Tesco Bank is owned by Tesco, they have adopted the same values when it comes to providing services to their customers: They’re the first to meet customers’ needs, they act responsibly for their communities and they understand their customers. To make the work experience more enjoyable, they have also adopted “the golden rule” – “treat others the way you want to be treated.” To do this, they work as a team, trust and respect each other, listen and support, say “thank you” and share knowledge/experience.

The number of products that Tesco Bank sells is presently a total of 28. Tesco can provide its services through Tesco stores, via the Internet, and by telephone. About 60% of new products sales are made online. Even though the activities of Tesco Bank are focused within the UK, they still provide some services to other areas and countries where Tesco has a presence: Ireland, Thailand, Malaysia, and Poland.

Tesco Bank Financial Products & Services

The key products that Tesco Bank offers include general Tesco Bank insurance (motor, home, life, pet, travel, health, and dental), Tesco personal loans, Tesco credit cards, Tesco personal savings products and Tesco Compare (an online insurance and utilities comparison program).

In some select Tesco Bank locations, customers can also receive free financial advice, as well as free quotes for insurance and loans. These specialized services are given by professionals trained by the Royal Bank of Scotland and are currently being used as a trial, meaning they will be spread throughout Tesco’s UK estate if they prove to be successful.

Being a part of one of the UK’s biggest and most popular supermarket chains, Tesco Bank is rapidly becoming more and more prevalent. Its ties to Tesco and its qualities that benefit its customers have proven that Tesco Bank will likely become more successful in the future.