Tesco Bank to close all current accounts

Tesco Bank is set to close all its 213,000 current accounts at the end of November.

Tesco Bank, which has offered current accounts since 2014, said only 12 per cent of these accounts had been used for more than “limited activity” and most were “being used for other purposes, such as a savings pot.”

The news comes after the bank stopped offering current accounts to new customers in December 2019.

Tesco Bank said current account customers will receive a letter within the next two weeks which will explain their options. These include moving to a Tesco Bank savings account or to another provider using the Current Account Switching Service (CASS).

Tesco Bank has five million customers across all its services, which include credit card, loan, insurance, and savings account products, which the supermarket said won’t be impacted by the recent move.

The supermarket bank reported a £175 million loss for 2020 in April, compared with a £193 million profit for the 2019 financial year.

Tesco Bank is not the only supermarket bank to reduce its operations; M&S Bank announced it will close all its current accounts and its 29 in-store bank branches in March.

"The way customers shop and manage their money is constantly evolving and we are committed to developing products and services which align with the needs of Tesco shoppers,” said chief executive at Tesco Bank Gerry Mallon. "With so few of our current account customers using it as their primary account we want to support them to find a suitable alternative dependent on their circumstances.”

He added: "We will pay particular attention to supporting any vulnerable customers and those in need of financial assistance."

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