Tesco Personal Finance is launching its first own-branded mortgage in its stores and over the internet.
Tesco says its mortgage is likely to be supported by advertising next year. It is being promoted with a tagline “start low… stay low”, together with the parent brand’s “every little helps” slogan.
The mortgage is being sourced from Royal Bank of Scotland’s (RBS) recently launched First Active, but will be branded as Tesco and will be serviced by Tesco call centres. Leaflets for the mortgage will be available in 700 Tesco stores around the country.
Tesco had previously only provided a link on its website to The One Account, the offset mortgage provider owned by RBS aimed at affluent young professionals. Tesco Personal Finance is a 50:50 joint venture between Tesco and RBS.
Arch-rival Sainsbury’s Bank withdrew from the mortgage market earlier this year, but has not ruled out returning to it with a new product.
The Tesco mortgage features a three-year discount rate of 4.75 per cent, followed by a standard rate of 5.74 per cent for the remainder of the mortgage.
First Active is the new mortgage brand of RBS to rival established players such as Abbey. Advertising agency Clemmow Hornby Inge was recently appointed to create a £12m advertising push to establish the First Active brand (MW August 26).