Barclays moves into Asda stores

Barclays is moving into four Asda stores. But what does this mean for Asda Money?

Barclays is to move into four Asda stores and offer banking services during shopping hours.

It will close four existing branches and move staff into nearby Asda supermarkets, which it says will offer customers a more flexible approach to banking.

The initial trial will start in February.

Supermarket trial

The first four Barclays branches to move will be in Bichwood in Cheshire, Pudsey in West Yorkshire, North Watford in Hertfordshire and Broadstairs in East Kent.

Barclays staff will be on hand during the traditional opening hours of nine to five. Outside of this, limited services - such as paying in cash and cheques, paying bills and withdrawing money - will be available during the supermarket opening hours.

Steve Cooper, head of Barclays retail and business bank, said: “This partnership with Asda means they (customers) can do their food shop and bank at the same time, with the opportunity for a new flexible banking experience in a way that’s most convenient for our customers.”

He also said the bank hopes to have an “innovative and sustainable future proof suite of branches that exist alongside a choice of ways our customers can contact us” by 2017. This suggests that if the initial trial is successful further branches will be included in the future.

Extended opening hours

Traditional banking hours are inconvenient for almost everyone with a full time job, so extending these is a positive move.

Combining banking with food shopping is also a good way for Barclays to lure in more customers, but also for customers of the bank to get their banking and shopping completed at the same time.

This move follows on from the likes of Metro Bank which is open seven days a week and described as an antidote to the traditional high street banks

Barclays versus Asda

One flaw in the branch merger is the fact Asda already has its own set of financial services under the Asda Money umbrella. It doesn't have its own banking licence, but offers these products through several partners, such as Travelex for its currency.

The group provides credit cards, travel money and car, travel, pet and life insurance. So it’ll be interesting to see how the two brands compete with Barclays promoting its own services in Asda shops.

Although Asda is a small player, it has a relatively competitive credit card which pays 1% cashback on Asda shopping and petrol and 0.5% on anything you buy elsewhere. There is also a 0% period for six months on purchases of more than £200 bought at Asda Direct and a 12-month 0% balance transfer period.

However, the offer is minimal when looking at Barclaycard. It dominates this market and its balance transfer cards have remained at the top of the tables for most of this year. It provides the longest-ever 0% balance transfer card of 30 months and also the cheapest 28-month card with a 2.49% fee.

Compare the best 0% balance transfer cards

Banking competition

Barclays moving into Asda shops is likely to pose a threat to Asda Money and this isn’t good news for competition in the banking sector. What I think would be better is Asda Money opening its own branches within its supermarkets, offering competitive current accounts and savings products.

This added pressure from strong smaller banks would force banks such as Barclays to improve the services they offer giving customers access to a wider range of better financial services.

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Do you think Barclays moving into Asda is positive? Or is this a further example of the dominance of the big banks? Let me know in the comments box below.

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