Tesco Personal Finance

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Tesco Personal Finance is a telephone and internet based commercial bank in the United Kingdom and is a 50:50 joint venture between Tesco, the UK's largest supermarket and the Royal Bank of Scotland, the fifth largest bank in the world. It is registered in Scotland at St Andrew's Square, Edinburgh.

Prior to the formation of TPF, Tesco had a banking joint venture with NatWest, which ended in February 1997. Tesco Personal Finance was formed in July 1997 following the successful launch of Sainsbury's Bank by its main UK competitor, J Sainsbury plc Sainsbury's. The bank was launched as a joint venture with the Royal Bank of Scotland, which processes all its financial transactions. Subsidiary companies of the Royal Bank, such as Direct Line, UKI and Lombard Direct help Tesco Personal Finance provide insurance products.

Tesco Personal Finance has been a great success for both Tesco and the Royal Bank of Scotland, returning profits of £65 million for Tesco for the financial year to February 2007. Tesco is able to use its large customer base to cross sell financial services products, and allows customers to accumulate Tesco Clubcard points when they purchase finance products. This strategy is highly effective because it can be combined with in store offers which results in customers spending higher amounts of money, often on non-food items inorder to increase sales across all product lines thus causing sustainable yet competitive growth which allows them to deal with control for market control with ASDA.

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