Supermarkets 'able to offer stronger financial products'

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Supermarkets 'able to offer stronger financial products'

Wed 14th Oct 2009

An industry commentator has claimed that supermarkets such as Sainsbury's and Tesco are in a good position to compete with traditional banks.

Ed Bowsher, head of personal finance at lovemoney.com, pointed out that banks currently have fairly weak balance sheets, so it is an ideal time for supermarkets to muscle in on the industry.

His comments were made following a statement from Sainsbury's Finance which indicated that it would be concentrating on the growth in popularity of its financial products in the future.

Mr Bowsher commented that Lloyds and Royal Bank of Scotland especially are in a weak position which Sainsbury's and Tesco can exploit.

He added: "Tesco made it very clear over the last year or so that it sees Tesco Bank as a big growth driver for them in the years to come and its also got some attractive products on offer."

In his view, there is an element of distrust in traditional banks from the consumer's point of view, but most importantly supermarkets are currently offering better products.

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