A sorry little blot appeared on Tesco’s escutcheon this week. The grocers felt moved to provide a further £57 million for mis-selling PPI policies, the latest example of insurance that’s always there except when you need it. In the context of the big banks, Tesco’s provision – now up to £92 million – is trivial, but nevertheless it’s a huge disappointment to those of us who had high hopes for Tesco’s revolutionary idea of banking which puts the customer first.

PPI was a scam. It was hugely profitable for the banks because many borrowers who were persuaded to buy it never had a hope of making a successful claim. PPI shows why the banks are held in such low regard by those forced to use them; Tesco was, and is, far better regarded by the paying customers. Other things being equal, we’d have more confidence that we weren’t being ripped off than, say, with Lloyds or Barclays.

Tesco has bought out its joint vanture partner, RBS, and still plans to offer “a full-service retail bank providing a comprehensive range of simple, good value financial products”, including mortgages and current accounts, next year. Well, we’ll see. The pity is that Tesco didn’t spot that PPI was neither simple nor good value in the first place.

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