by Mark Johnston
Marks and Spencer (M&S) launched their money service in 1985 and since 2000 they have offered home, travel and pet insurance. In 2003 they then launched a credit card and loyalty scheme.
Therefore with over 25 years financial services experience it is no wonder that they have recently confirmed that they are to launch their own bank with 50 branches planned for the next 2 years; the first bank will open its doors to customers in July 2012.
Steve Sharp, the Marks and Spencer (M&S) marketing director suggested that the idea of turning its already successful financial services division in to a fully fledged bank came as he watched news reports on the collapse of Northern Rock in 2007. He said “my thought was if only we had a bank they would turn up in their droves to deposit their money because they trust us”.
Marks and Spencer boast that branch opening times will mirror its existing stores and include weekends, meaning that they will be open for double the hours of other high street banks.
Colin Kersley, chief executive of the new M&S bank, stated “we know loyal Marks and Spencer customers will be genuinely excited by the prospect of banking with their favourite retailer”.
However current accounts will not be available until the autumn and mortgages will be offered at a later stage. This particular area needs more thought as Sir Stuart Rose, former chief executive and the Marks and Spencer (M&S) board worry that if you offer mortgages, at some stage they may be forced to repossess a Marks and Spencer (M&S) customer, which would be terrible for the brand.
A full bank service by the retailer will build upon the shops existing financial arm which already has more than 3 million customers most of these having their credit card.
The advantage that Marks and Spencer (M&S) has over other retailers is the fact that it is already an established brand which is trusted by millions; it is also owned and run by one of the world’s most successful and financially strong banks HSBC.
Mark Bolland, chief executive at Marks and Spencer (M&S) said “M&S is one of the most trusted brands on the UK high street and we have achieved this by continually listening and responding to the needs of our 21 million customers”.
Andrew Hagger of moneynet.co.uk, a comparison website, said he welcomed some ‘new blood’ in the current market and added “it is good that even though it is part of the HSBC group, M&S money is authorised with the Financial Services Authority (FSA) in its own right.
Marks and Spencer is not the first retailer however to step up plans in the financial industry, Tesco also have around 6.5 million people banking with them. It seems then that like Tesco, Marks and Spencer has capitalised on the unease felt by many consumers in ‘big’ name high street banks.
Some experts are skeptical about this venture and feel that it is hardly another bank it is just one of HSBC’s brands expanding its services.
Story link - Marks and Spencer to Launch Bank
Related stories to : Marks and Spencer to Launch Bank