Tesco targets 10% of financial services market

Tesco is reportedly aiming to end up with a 10% share of Britain’s financial services market, putting the supermarket on a par with Abbey and equivalent to a market share more than half the size of Barclays.

A senior source at Tesco has told the Mail on Sunday: “We might be a bit bigger than 10% in some areas and a bit smaller in others, but that is roughly where we expect to end up.”

It is reported that Tesco may look to offer mortgages as early as the end of this year, but a spokeswoman for Tesco has previously told Mortgage Strategy that there is no set timescale for launching Tesco mortgages.

This is the first time Tesco has put a figure to its ambitions in the financial services sector.

A statement from Tesco says the target concerns the supermarket’s long-term goals.

A spokesman for Tesco says: “We wouldn’t give a specific overall figure but plan to use the relationship we have with our loyal customers ultimately to create a substantial business in a number of areas.  

“We already have a successful credit card business with a 10% share of transactions and some 4% of motor insurance.

“Of course there are some markets, such as investment banking, which we are not interested in at all.”

Other new entrants also making a play for the financial services market include Metro Bank, which gained its licence from the Financial Services Authority last month, and Virgin Money.

It is reported today that US investor Wilbur Ross has bought a 21% stake in Virgin Money for £100m.