Asda is understood to be on the brink of launching the UK’s lowest-priced bank in a joint venture with the Royal Bank of Scotland.
Sources close to the Royal Bank of Scotland say the bank is about to sign a deal with the grocery chain involving the launch of full banking facilities and a credit card in a deal similar to that struck by Sainsbury’s and the Bank of Scotland.
“Asda wanted the best possible deal to fit with the Asda Price proposition and many of the banks could not offer it,” says a source close to the plans.
According to a senior source in a rival bank which pitched for the Asda business, Asda’s arrangement includes a low price promise.
“It had to have a very low price proposition with a high reward and a credit card with a very low annual percentage rate of about 12 per cent,” he says.
The credit card will include a no fee arrangement, and the deal also includes full banking services as part of the exclusive link-up.
The partnership would be the fourth major supermarket banking deal. The first was Tesco and Nat-West, revealed by Marketing Week (April 19 1996), which resulted in the launch of Tesco Clubcard Plus.
The second was Sainsbury’s and Bank of Scotland. The third deal was Safeway’s and Abbey National, which includes the launch of an Electron debit card.
An Asda spokeswoman says: “We have not made an announcement and we would not like to speculate about it. We are always looking at new and different opportunities.”