Sainsbury’s to wind down banking service – 1.9 million customers could be affected

The supermarket said it was exploring a number of options as part of a “phased withdrawal” from the banking business.

It could result in products being outsourced to other providers, which it already does with insurance products, and through which it offers Argos credit cards and loans to around 2.1 million customers.

The company currently offers loans, credit cards and savings accounts from its own bank.

Sainsbury’s said it would be “business as usual for now” at the bank.

Nothing will immediately change for customers or the products and services being offered.

There isn’t a timeline for how long the exit will take.

Simon Roberts, chief executive of Sainsbury’s, said: “We have been clear since we launched our food first strategy in 2020 that we would concentrate our efforts on our core retail businesses and today’s announcement reflects that strategic focus.

“We will, of course, communicate directly to customers well in advance of any changes to their products and services.”

Sainsbury's said on Thursday: “In order to improve the financial services offered to customers and consistent with the clear focus on our retail businesses, we are exploring a number of options."

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If Sainsbury's continued to offer financial services in the future, it would do so as a distributor, meaning it would offer "white-label" financial products from other providers under the Sainsbury's brand.

This would mean customers could access credit cards and savings products via the supermarket, but Sainsbury's wouldn't have to carry risks on its balance sheet.

Sainsbury's said: “Over time this will result in a phased withdrawal from our core banking business."