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Supermarkets Prove Popular For Household Banking Products

11 February 2014

 

Following Sainsbury’s recent acquisition of the 50% stake held by Lloyds Banking Group in Sainsbury’s Bank, research(1) reveals the potential for supermarket banking.

Sainsbury’s Bank commissioned research(1) with over 4,000 people, and 55% are considering taking out a banking or insurance product over the next 12 months, or switching to another provider.  Of those, 38% – or about 9.8 million people – are considering taking out a new banking or insurance product from supermarket banks.

Of those looking for a new personal loan in the coming 12 months, 46% would consider a supermarket bank, as would 43% of those considering taking out a new pet insurance policy, and 40% of those looking at having a new credit card(1).

Peter Griffiths, Chief Executive of Sainsbury’s Bank said: “With many people’s household budgets still stretched, doing your research and shopping around for financial products that deliver quality and value is essential.

“Sainsbury’s was the first supermarket to open a bank, back in 1997 and our proposition has never been stronger.  We design our products and services with the Sainsbury’s supermarket customer in mind, providing great value and quality with the additional benefit of Nectar points(2).”

The findings reveal that it’s great offers and loyalty schemes that are attracting consumers to products from supermarket banks.  Some 69% say it is because they are competitively priced; 61% because they provide attractive offers, and 47% say it’s because they offer a loyalty or reward scheme(1).

Sainsbury’s Bank offers double Nectar points for two years on selected insurance and banking products. The more qualifying products customers have, the more points they could earn.  For example, if a customer has all six products, they could earn up to seven times the number of  points on all of their Sainsbury’s shopping (when using their Nectar card at the same time). This is the equivalent of up to 7% back on their Sainsbury’s shopping.

New customers buying the Bank’s car, home and pet insurance also receive initial discounts on their premiums and preferential rates on loans are also available to Sainsbury’s shoppers with Nectar cards.

Sainsbury’s Bank has some of the most competitive and attractive household banking products available. For example, its current personal loan rate of 4.6% APR Representative (for loans between £7,500 and £15,000 taken over three years) is one of the most competitive rates available, and the Sainsbury’s Nectar Credit Card is among only 1% of cards in the market that provides an introductory offer of 0% APR on both balance transfers and purchases for 15 months (16.9% APR Representative Variable), and a double Nectar reward scheme that is equivalent to 2% back(3) on all Sainsbury’s shopping(4).

On the insurance side, its Premier Cover Car Insurance(5) guarantees to provide a like for like courtesy car for the duration of any repairs, something that only 5% of policies in the market offer(6).  Sainsbury’s Premier Cover Home Insurance is among just 9% of policies in the market to offer unlimited buildings cover(6), and its Pet Insurance provides up to £13,000 of cover per condition for veterinary fees, which only 2% of maximum benefit policies offer(6).

Sainsbury’s Bank is looking to grow by continuing to provide its customers with competitive banking and insurance products that offer generous rewards. The Bank currently has 1.5 million active customer accounts and has a massive opportunity for growth with 23 million shoppers visiting its stores each week.

However, growth will be achieved by remaining focused on responsible lending, ensuring that its products remain good quality and competitive, offering good value to the Sainsbury’s customer while further enhancing its already strong and unique Nectar reward proposition.

– ends –

Notes to editors:

Rates and information correct at 4th February 2014

Retail Banking or Insurance product Percentage of people who are planning to take this product out over the next 12 months and would consider a supermarket bank(1)
Personal loan 46%
Pet insurance 43%
Credit card 40%
Travel money 37%
Critical illness 37%
Home insurance 35%
Savings account 35%
Car insurance 34%
Travel insurance 32%
Current accounts 26%
Mortgages 24%
Life insurance 22%

 

(1) Sainsbury’s Bank commissioned independent research agency, ICM. ICM interviewed a random sample of 4,062 adults aged 18+ in GB online between 15th -19th January 2014. Surveys were conducted across the country and the results have been weighted to the profile of all adults. ICM is a member of the British Polling Council and abides by its rules. Further information at www.icmresearch.com

(2) Nectar points available on selected products.

(3) According to independent analysis conducted by Moneycomms of the UK credit card, savings, loan and travel money markets in January 2014, commissioned by Sainsbury’s Bank

(4) Purchase must be made using Sainsbury’s Bank credit card and Nectar card must be used at the same time

(5) U K Insurance Limited is the underwriter of Sainsbury’s Bank car insurance and Sainsbury’s Bank home insurance and is part of the Direct Line Group plc. Direct Line Group plc (Direct Line Group) is headquartered in Bromley; it has operations in the UK, Germany and Italy. Pet Insurance provided by Allianz Insurance plc.

(6) According to independent analysis of the UK life insurance and general insurance markets conducted by Defaqto in January 2014, commissioned by Sainsbury’s Bank

 

 Sainsbury’s Bank:

To view our latest press releases and product information, please visit the Sainsbury’s Bank online media centre at www.sainsburysbank.co.uk/media

Sainsbury’s was the first major British supermarket to open a bank, commencing trading in February 1997. Benefiting from a fantastic, trusted brand that enables us to combine the shopping experience with personal finance, Sainsbury’s Bank provides a range of quality products including insurances, credit cards, savings and loans. Our proposition is to make shopping more rewarding by offering customers great products at fair prices, while consistently rewarding shoppers for their loyalty and being easy to do business with at all times. Our products consistently top best buy tables and regularly win awards for quality, price and service.

Sainsbury’s Bank has its own banking licence, is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority (register no. 184514), except for Credit Cards and Loans where it is licensed by the Office of Fair Trading (OFT) license no. 421897. The Bank has an independent membership to the Financial Services Compensation Scheme.