UK grocer Tesco is to stop offering its credit card in the Irish market, in a further blow for Irish consumers left with a shrinking number of financial services providers.
In a statement, a spokeswoman for the supermarket chain said it “apologises that customers are currently no longer able to apply for a Tesco Bank Credit Card in the Republic of Ireland.”
“We have stopped accepting applications while we review our products and how we can best serve our customers in the future,” she said, adding that existing customers can continue to use their card as normal and will continue to receive Clubcard loyalty points with the card.
In 2014 the grocer shut its car, home and pet insurance offerings to new customers in the Irish market, leaving the credit card as its sole financial services product in the market.
While the grocery group, which operates an extensive financial services arm in the UK, did not explain the reasons behind the move, the UK's imminent departure from the European Union could be a factor. Tesco Bank is authorised in the UK, and operates in Ireland on a cross-Border basis under European Union passporting rules. Once the UK departs the EU, these rules will no longer apply, which would mean that the grocer would have to apply for a full licence in Ireland.
Tesco first entered the Irish credit card market in 2000, shaking up the banking sector by offering an initial APR of just 4.9 per cent and a 0 per cent balance transfer rate for six months.
Blow for consumers
The Tesco credit card was popular with shoppers at the chain as it allowed them to collect 50 per cent more Tesco points when they paid with the credit card rather than cash, while points were also available on purchases elsewhere. These points were then sent out in Clubcard vouchers which could be used instore to cut the cost of shopping, or transferred to deals tokens and used to pay for other incentives such as magazine subscriptions, dining out, and hotel stays.
The grocer's decision to pull its credit card from the Irish market was effective on May 10th, and is a further blow for consumers in the wake of other departures, as competitive forces continue to decline. Last month UK building society Nationwide said it will leave the Irish market, impacting about 14,000 customers; while Dutch bank Rabobank has also scaled down its Irish operations in recent months, closing its investment fund offering.
The number of Irish credit card providers has also shrunk substantially, given the departure of other players such as Danske Bank, MBNA and Halifax/Bank of Scotland. Tesco's decision means that Irish consumers now have just five domestic providers to choose from, with pan-European mobile platforms, such as N26 and Revolut, other options.
