Tesco Bank Strategy and Outcome Analysis

Tesco Bank's strategy aimed to become a leading personal financial services business in the UK, with a focus on current accounts, credit cards, loans, and savings products.

The bank launched a range of products and services, including a current account with a £5 monthly fee, a credit card with a 0% interest rate for 18 months, and a loan with a competitive interest rate.

Tesco Bank also partnered with other companies to offer exclusive deals to its customers, such as a 5% discount on purchases made with its credit card at Tesco supermarkets.

The bank's strategy was designed to appeal to customers who value convenience and rewards, with many of its products and services offering benefits such as cashback and discounts.

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Tesco Bank has a long history that dates back to 1997 when it was formed as a joint venture with the Royal Bank of Scotland, following the successful launch of Sainsbury's Bank by its main competitor.

In its early days, Tesco Personal Finance partnered with subsidiary companies of the Royal Bank, such as Direct Line, UKI and Lombard Direct, to offer insurance products to its customers.

The bank's ownership changed in 2008 when Tesco bought out the Royal Bank of Scotland's 50% stake for £950 million.

Tesco Personal Finance was rebranded as Tesco Bank in 2009, marking a significant change in the company's identity.

In 2024, Barclays acquired the bank's credit cards, loans, and savings operations for £700 million, leaving Tesco with its insurance, ATMs, travel money, and gift card operations.

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Tesco Bank provides a range of personal accounts, including credit cards, loans, savings accounts, insurance, and foreign currency exchange.

Mortgages were added in August 2012, after briefly offering products provided by First Active in November 2004.

Tesco Bank launched its first mobile app in 2014, supporting its core transactional products (Current and Savings accounts as well as Credit cards).

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In subsequent years, Tesco Bank launched a number of innovative features, including "balance peek" in 2015.

Tesco Bank was the first bank in the world to deploy an app for Apple Watch at its launch in 2015.

The bank sold its mortgage portfolio to Lloyds Banking Group in September 2019.

Tesco Bank stopped offering current accounts to new customers in February 2020.

Tesco Bank announced it will be closing all current accounts held by its customers on 26 July 2021, citing "limited activity".

Tesco Bank is registered in Scotland at 2 South Gyle Crescent, Edinburgh EH12 9FQ.

The bank initially shared its registered office with RBS at St Andrew Square, Edinburgh, while operating as a joint venture.

Tesco Bank has offices at Quorum Business Park in Newcastle and Broadway One in Glasgow, which were opened in July 2010.

There's also an office in South Gyle, Edinburgh, which was opened later.

Tesco Bank closed all three remaining in-store branches on 14 May 2016, focusing on being a completely online bank.

You can still access Tesco Travel Money Bureaux, an in-store bureau de change, managed by a joint venture with Travelex, at over three hundred locations.

Tesco Bank has faced several challenges over the years, including a major cyber attack in 2016 that compromised the personal data of over 2.5 million customers.

The bank's online banking system was also criticized for being vulnerable to hacking, with some users reporting difficulties in accessing their accounts.

Tesco Bank's decision to sell its loan and credit card business to Barclays in 2020 was a significant setback for the bank, and raised concerns about the future of its financial services.

In November 2016, a major cyber attack hit Tesco Bank, affecting up to 40,000 customers.

Customers reported losing hundreds or thousands of pounds from their accounts, with some transactions originating in Brazil.

The bank suspended online transactions and later declared that the attack resulted in the loss of £2.5 million.

Shares in the retail group fell 3% on the news, showing the significant impact on the company's stock.

The UK Financial Conduct Authority took action, asking the bank to pay £16.4 million as a penalty.

Tesco Bank faced a significant challenge in the competitive mobile banking landscape. They needed a mobile app that could seamlessly integrate their diverse financial products.

The app had to provide a superior customer experience, which meant unifying previously siloed product roadmaps and aligning with the bank's broader strategy. This required a solution that could deliver measurable success.

Tesco Bank's diverse customer base presented another challenge, requiring an intuitive and efficient toolset to manage their finances.

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Millions of customers are impacted by the Barclays takeover of Tesco Bank. The deal was finalised on November 1 after getting the green light from regulators and the High Court.

Tesco Bank customers can rest assured that they can continue using their services as usual. However, Barclays typically offers lower interest rates on savings compared to Tesco Bank, so it's worth reviewing your savings rates to see if better options are available elsewhere.

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The takeover encompasses Tesco's credit card portfolio and unsecured personal loans, valued at around £8.3 billion, along with roughly £6.7 billion in customer deposits. This deal will affect millions with savings, credit cards, and loans.

Tesco plans to return £700million to shareholders using the proceeds from the deal. This move was announced earlier this year and approved by the High Court in October.

The partnership does not include Tesco ATMs, gift cards, insurance and travel money services. However, it does include Clubcard Pay+, a prepaid debit card, according to the Mirror.

Barclays will continue to use the Tesco Bank brand on all existing Tesco Bank banking products through a partnership agreement with Tesco. This means that Tesco Bank savings accounts, Clubcard Pay+ accounts, credit cards and loans are now run by Barclays.

Tesco Bank is now owned by Barclays, a move that affects millions of customers with savings, credit cards, and loans.

The takeover was finalised on November 1 after getting the green light from regulators and the High Court, and it encompasses Tesco's credit card portfolio and unsecured personal loans, valued at around £8.3 billion, along with roughly £6.7 billion in customer deposits.

Tesco Bank customers can rest assured that they can continue using their services as usual, with no immediate changes to their accounts.

However, it's worth reviewing your savings rates to see if better options are available elsewhere, as Barclays typically offers lower interest rates on savings compared to Tesco Bank.

Tesco plans to return £700 million to shareholders using the proceeds from the deal, and the partnership does not include Tesco ATMs, gift cards, insurance, or travel money services.

Barclays will continue to use the Tesco Bank brand on all existing banking products through a partnership agreement with Tesco, and customers will have access to new and innovative propositions while continuing to enjoy the unique benefits of Tesco Clubcard.

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Collaboration played a crucial role in bringing Tesco Bank's vision to life. A multidisciplinary team of designers, researchers, and product experts worked together for 12 weeks.

This team worked closely with Tesco Bank, engaging in a highly collaborative process that involved gathering insights from both customers and internal stakeholders. This approach ensured that the app was designed with a deep understanding of customer needs and aligned with the bank's strategic goals.

Tesco Bank's strategy involved developing a comprehensive product roadmap after an extensive discovery phase. This roadmap helped unify previously siloed product developments into a cohesive plan.

The new app was designed to maximise its impact by bringing together previously separate product developments. This unified approach enabled Tesco Bank to focus its efforts and resources more effectively.

The roadmap also provided detailed information architecture and technical feasibility assessments. This helped Tesco Bank visualise the app's evolution over time and ensure that it could scale effectively.

The outcome of the collaboration between CreateFuture and Tesco Bank was a customer-focused mobile app that meets current needs and is strategically positioned for future growth.

CreateFuture successfully supported Tesco Bank in reimagining its mobile app, delivering a product roadmap that has become a cornerstone of the bank's mobile strategy.

The tools and approaches provided by CreateFuture have empowered Tesco Bank to better understand and articulate customer experiences across its teams.

Developing a new mobile app designed to offer tailored tools and content that empowers users to manage their finances with confidence and ease was a key focus of the project.