Tesco Finance puts stop to personal loans
TESCO Personal Finance, which provides one of the lowest priced loan deals for consumers in the market, has stopped issuing loans.
The company said last night it had written to its 3,600 personal loan customers telling them it has temporarily halted issuing loans. Tesco offers loans at 6.9pc, much lower than other lenders in the market.
It is understood a spike in customer defaults has forced the group to reassess the pricing of its loans and the group has decided to stop issuing loans for now. The rise in impairment charges has made its low interest rate offer uncompetitive, it is understood.
In a statement last night Tesco's David Beattie said: "Tesco Personal Finance confirms that it has temporarily halted issuing personal loans in the Republic of Ireland.
"All existing customers will continue to be serviced by Ulster Bank and we are writing to all customers to confirm this. There are 3,600 personal loans currently in issue with an average value of €9,500."
The company went on to say it expects to be in a position to offer consumers another competitive alternative in the near future. Mr Beattie was unable to put a timeframe on a return to the market with the loan offer.
Tesco Personal Finance will continue to offer customers a range of financial products including credit cards, car insurance and life insurance, the company said.
- Charlie Weston Personal Finance Editor
