Could supermarkets soon take over current accounts market?

There was a time when supermarkets were only used for the purchase of groceries and household goods, but all of this has changed over recent years.

Many leading supermarkets in the UK have really branched out over recent years, and have started offering an array of financial products and services, such as insurance services, loans, and credit cards, amongst others. Many offer savings accounts as well as banking services, providing the consumer with far more choice when it comes to finding the best financial products and services.

A recent survey has revealed just how popular supermarket financial services have become in the UK, indicating that one in every ten consumers has a supermarket savings account, and one in every five shoppers holds a supermarket credit card. The figures show just how much business supermarket giants such as Asda, Tesco, and Sainsbury’s have taken away from the major banks in the UK. Figures also indicate that if supermarkets decide to branch out further they could take away far more business from banks.

According to the results of the survey around half of consumers in the UK would like to see supermarkets branch out and offer more in the way of financial products, as most think that supermarkets can offer far better value and service on such services and products. Current accounts seemed to be of particular interest, and although only one in every two hundred consumers has a supermarket current account at present, if more supermarkets offer this facility they could end up with close to half of the 40 million current accounts in operation in the UK today.

One industry expert stated: “This is a massive unpicked cherry for supermarkets to target. With their low running costs, supermarkets can easily undercut other providers. They are already pinching customers from banks and in time could steal even more.”

Tom Smith
25th September 2007

Tags: current, accounts, financial, supermarkets, Insurance, savings, consumers, products

Financial advisers now under scrutiny

UK regulators have been cracking down on all sorts of services and sectors over the past year, from bank and credit card charges to travel insurance and payment protection cover. Read more

Tags: advisers, personal. mortgages, free, advice, products

HSBC to improve insurance products

One of the UK’s leading banks, HSBC, has announced that it is extending its relationship with insurance underwriter Norwich Union in a bid to improve the insurance products and services that it provides.

Over ten million customers with HSBC can now opt for a range of general insurance products through HSBC that will be underwritten by Norwich Union. The bank and the insurance company have already been working together for over twenty years on certain insurance products, and their relationship will be strengthened as the bank increases the insurance products that will now be provided through Norwich Union.

HSBC hopes that this latest move will place it amongst the top ten providers of general insurance in the UK. Previously, HSBC offered a number of insurance products through Norwich Union, and this included travel, vehicle, and home insurance.

The bank also hopes that profits from its insurance products can be doubled through this improved joint venture, with the bank’s managing director of insurance stating: ‘Creating preferred strategic partnerships with leading general insurers is a key element of that plan. In the UK, an estimated £1 in every £5 of financial services expenditure is spent on insurance. That is why we have chosen Norwich Union, the leading UK insurer with whom we already have a strong working relationship, to help HSBC satisfy its customers’ insurance needs.’

The Chief Executive of HSBC stated: ‘It would be fair to say that HSBC has historically punched below its weight in insurance but we have shown before that our customers want to stay with us if we offer well serviced, good value products.’

Tom Smith
23rd May 2007

Tags: travel, Insurance, norwich union, products, hsbc, car, increase, contents, offers, home