Many financial services from supermarkets and other “non-traditional providers” offer value which is “at best average”, it has emerged.
According to research by consumer group Which?, services such as credit cards and loans offered by these lenders are often “a swizz”.
It was found that the credit card from Morrisons was the worst for borrowing, charging annual interest of £224. This is £153 higher than the Halifax Flat Rate Online Card – identified previously as a Which? Best Buy.
In addition, those who borrow £5,000 from Marks & Spencer would pay £348 more in costs over three years than the same deal from Moneyback Bank, the cheapest provider.
However, James Thorpe, a spokesperson for Marks & Spencer, defended its rates record, saying it charges a “competitive rate for customers”.
“Some of our annual percentage rates you might find are a little expensive, but certainly with larger sums we are competitive.”
He added that personal loans from Marks & Spencer involve levels of customer service as opposed to extras such as money back, which Mr Thorpe said was “all bells and whistles”.
Tesco also defended non-traditional lenders, but its Personal Finance Spokesperson, Monica McCormack, said that “the personal finance market is very competitive.
“Tesco stands for consistently good value and we don’t subscribe to the high low pricing agenda of some of our rivals.”
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