13% of Brits place trust in supermarket banks
A growing number of British consumers say they trust a retail or supermarket brand to look after their finances more than a bank.
Some 13% said they trusted the likes of Tesco Bank and Sainsbury's Bank more than traditional high street banks, while 17% think a retailer/supermarket bank would provide better customer service, according to a Moneysupermarket.com study.
A fifth say they get a cheaper deal for a range of products with a supermarket bank and 12% say they like to be able to get everything - from washing up liquid to their bank balance - from one place.
However, while a third of consumers are happy with the growth and expansion of supermarket brands into the world of personal finance, 25% feel they should stick to traditional products, and 17% think they should stop expanding altogether.
These figures are markedly different to what they were just five years ago. In 2009, only 11% of people felt supermarkets should stick to more traditional products, while almost a third thought they should stop expanding.
However, trust has improved over the period. In 2009 only 4% trusted a supermarket bank more than their more established high street peers.
And while in 2009 the proportion of people who trusted supermarket banks and traditional players equally was 22%, this has climbed to 40% in 2014, suggesting trust in financial service providers has increased across the board.
Kevin Mountford, head of banking at Moneysupermarket, said: "We have seen more and more retail brands expanding into the financial services world and growing product offerings, with Tesco's current account launch being the most recent example.
"The introduction of more competition within financial services should be embraced, especially as this generally heralds a better deal for consumers. The more choice there is, the easier people should find the right fit for their modern day banking needs.
"Although the time honoured banking brands still hold far more trust than supermarket brands when it comes to managing the UK's finances, the shopping giants such as Tesco, Sainsbury's and M&S have come someway to tackle this obstacle but are yet to take a reasonable share of the market."
An account opened with a clearing bank (few building societies offer current accounts) that provides the ability to draw cash (usually via a debit card) or cheques from the account. Some pay fairly minimal rates of interest if the account is in credit. Most current accounts insist your monthly income (salary or pension) is paid directly in each month and they offer a number of optional services – such as overdrafts and charge cards – which are negotiable but will incur fees.