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Tesco launches current account

10 Jun 2014

In a move to attract individuals fed up of ‘smoke and mirrors’ banking, retail giant Tesco has outlined the terms on offer in its own current account.

Tesco’s banking division was first started 17 years ago, and this current account is seen as an attempt to challenge the main high street banks. New account switching rules were introduced last year, meaning that more customers are likely to move their finances to so-called ‘challenger banks’.

The account offers no fee providing customers deposit at least 750 per month, and 3% AER on balances up to 3,000 and no interest on higher amounts. Working with Tesco Clubcard, every 4 spent in their stores earns the customer one point. Outside of Tesco’s own stores customers earn one point for every 8 spent.

MoneySavingExpert.com analyst Helen Saxon said: ‘This is a massive day for British banking with one of the UK’s largest banks and largest supermarkets roaring full steam ahead into the market.

‘But beware of getting too swamped by all the hype. While the account’s good, it is beatable by other higher interest-paying accounts and cashback credit cards’.