Asda has become the latest supermarket to move into personal finance.
The supermarket giant will offer customers a range of products including credit cards, insurance and currency exchange through the Asda Money Service.
The move will increase competition in another area between supermarkets including Tesco and Sainsbury’s who have already established themselves in some areas of personal finance. Both Tesco and Asda regularly appear close too or at the top of best-buy tables for credit cards and personal loans.
Marks & Spencer has also entered the market backed by HSBC bank.
One of its early products will be a credit card offering unlimited cash back. Customers will receive one per cent cash back on all Asda fuel and shopping plus 0.5 per cent cash back on non-Asda purchases. The interest rate will be 14.9 per cent APR and comes with a twelve month balance transfer offer.
There is no zero per cent offer on purchase though, so if you use the card make sure you repay the balance in full to avoid paying any interest.
Asda has also recently launched an Energy Compare and Save service which aims to entice utility customers to compare and switch energy suppliers. Along with switching current accounts, this is an area of personal finance in which customers seem reluctant to change, even though many could save between £100 - £200 annually.
Kirsty Ward, head of Asda Money, said: "Times are tough and we want to do more for the millions of people that shop at Asda every day. Financial products are important, but they shouldn't cost the earth and you shouldn't need to be an expert to buy one."
Kevin Mountford, head of banking at MoneySupermarket, said: "The relaunch of Asda Finance as Asda Money adds another competitor to those challenging the big banks, and creates more competition for consumers.
“The supermarket sector in particular has played a big part in financial services over recent years and Asda is the latest welcome addition.”
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