Tesco Bank personal loans: At a glance
Tesco Bank is one of the best personal loan lenders we’ve reviewed with a 5-star rating for its flexibility and application process, although it has a more limited range of customer support compared to some other lenders.
Tesco Bank personal loans offer longer-than-usual repayment periods and the chance to delay making your first loan repayment for two months. However, keep in mind that using this option will increase the overall cost of the loan.
Customer reviews are positive and Clubcard holders could get reduced rates, but if you want the largest possible loan or have a poor credit history, you may want to look elsewhere.
If you’re considering a loan, it’s sensible to only borrow what you need and pay it back as quickly as possible based on what you can comfortably afford to repay each month.
NerdWallet Review Rating
See how we rate our lenders below.
Important information: Neither the review nor the star ratings considered the lender’s lending rates or representative APR, and therefore does not reflect how much they charge to borrow with them. The rates on this page have been provided as additional information. Always check and compare a lender’s rates against others on the market when considering a loan. The rate you are offered will be dependent on your personal circumstances, loan amount and term and may differ from the representative APR.
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Tesco Bank Personal Loan
1 to 10 years
£3,000 to £35,000
6.1%*
Yes
Representative APR 6.1%*. Based on a loan of £10,000 over 60 months at an interest rate of 5.9358% p.a. (nominal). Monthly repayments of £193.02. Total amount payable £11,581.20. Maximum APR: 34.5%.
- Must be a UK resident
- Must be aged 18 or over
Learn more about how we bring you our review.
Tesco Bank loans pros & cons
Pros
- You can choose the date that your monthly payments are taken.
- Joint loans are available.
- You could get an instant decision when applying online.
- Tesco Clubcard holders could get preferential rates.
Cons
- There are interest charges if you pay your loan off early.
- There is a more limited choice of customer support than other lenders we’ve reviewed.
The pros and cons featured here are chosen by us based on a combination of our expert opinions from our research of the personal loans market and an exclusive survey of UK consumers conducted on behalf of NerdWallet UK in February 2023 to identify the features of personal loans that people feel are most important. They are unlikely to be the only product features and restrictions that you should consider. Pros and Cons are subjective and you should align them to your own personal circumstances. Information was correct at the time of publication but may have changed since.
Tesco Bank loan overview
Established in 1997, Tesco Bank offers several financial products and services, including personal unsecured loans, credit cards, car insurance and savings accounts.
Tesco Bank offers unsecured personal loans to individual borrowers and those looking to take out a joint loan. Importantly, you don’t need to be an existing customer of the bank to apply.
It’s possible to take out a Tesco Bank personal loan of between £3,000 and £35,000, while the length of time you’re allowed to repay the loan can be as short as one year and potentially as long as 10 years, depending on the loan amount and how the funds will be used.
Tesco is selling its retail banking operations, which includes personal loans, to Barclays. This process is expected to complete in the second half of 2024.
| Amount borrowable | £3,000 to £35,000 |
| Term length | One to 10 years |
| Time to get a decision | Instant |
| Time to receive funds once approved | 24 to 48 hours |
| Need to have an account with the provider? | No |
| Customer support | Phone, mobile app, social media |
How do we rate Tesco Bank’s personal loans?
We’ve assessed a selection of UK loan providers and rated each against a set of criteria that take into consideration what loan customers tell us are the most important product features.
Here’s what we review and how Tesco Bank performs:
| Criteria | Star rating |
|---|---|
| Flexibility | 5 stars |
| Application process | 5 stars |
| Available customer support | 2.5 stars |
| Overall(The overall score is weighted in favour of the features borrowers told us they consider most important) | 5 stars |
NerdWallet’s star rating assessment criteria does not include the lender’s product lending rates or fees. Always check and compare a lender’s rates against others on the market when considering a loan.
Category definitions
Flexibility
A flexible loan gives customers a choice of funds, terms and payment options. That means offering a wide range of loan amounts and repayment term options, allowing the borrower to change their payment date and make overpayments, for example.
Application process
The best application processes are quick and easy, with clear eligibility criteria, soft checks and multiple ways to apply to suit different customers’ needs.
Available customer support
Good customer support can include clear information on the lender’s website and a customer service team that’s available most of the time and can be reached in multiple ways.
Where Tesco Bank personal loans stand out
Long repayment periods
Tesco Bank offers loans that can be repaid over a period of up to 10 years if you’re borrowing between £10,000 and £25,000. By contrast, the longest repayment term many other lenders offer is just seven or even five years. Repaying a loan over a longer period can lower monthly repayments, though you will end up paying more in interest overall.
Quick approval decision
Tesco says that if you apply for its personal loan online, it is possible to get an instant decision that tells you whether your application has been successful, declined, or if you need to provide more information. To give yourself the best chance of a quick decision, try to have as much information to hand as you can when you’re about to apply.
It offers joint loans
Tesco Bank allows applications for joint loans, whereas not every lender does. Taking out a joint loan with someone else could improve your chances of approval if they have a higher income or better credit score, and lets you share the cost of the loan.
You can delay the start of your repayments
With a Tesco Bank loan, eligible borrowers can delay making their first repayment for two months. The way it works means you’ll end up paying more interest overall, but it’s a useful option if you’re not in a position to start paying back your loan straight away.
Where Tesco Bank personal loans fall short
It’s possible to borrow more elsewhere
The most you can borrow through a Tesco personal loan is £35,000. It’s not the lowest maximum amount among lenders – some cap the amount that can be borrowed at £25,000 – but if you need an even larger loan, it’s possible to borrow up to £50,000 elsewhere.
No bad credit loans
Tesco Bank doesn’t say that you need a good credit score to apply for a loan, so if your credit isn’t entirely up to scratch it might still be possible to get offered a loan. However, if your credit situation is closer to bad than fair, it is worth noting that Tesco makes it clear that it doesn’t offer dedicated bad credit loans.
Features
The personal loans available from Tesco Bank are unsecured loans, which can be taken out without having to put forward an asset that you own as security, or collateral, against the loan. The amount borrowed, plus interest, is then paid back in fixed monthly repayments made over a set period of time, called the loan term.
The interest rate you’re offered will depend on your personal circumstances and the amount you wish to borrow, for example a £5,000 loan or £10,000 loan. It’s also worth noting that if you’re a Tesco Clubcard holder when you apply, Tesco Bank might offer you a lower rate.
Helpfully, there’s an easy-to-use loan calculator on the bank’s website. This gives an indication of how much the monthly repayments and total amount repayable might be on a typical Tesco personal loan at different loan amounts and over various terms.
Tesco Bank loans can be used for a wide variety of reasons, including to fund home improvements, buy a car, pay for a wedding or holiday, and consolidate existing debt.
» MORE: Try our personal loan calculator
Joint loans
Tesco Bank offers joint loans if you’re looking to borrow with a partner, relative or friend. Tesco joint loans are available for between £3,000 and £35,000 and are potentially repayable over between one and 10 years, depending on the amount borrowed and the reason for taking the loan.
Remember, if you take out a joint loan with someone, your credit files will be linked and you’ll both be jointly responsible for paying back the loan. Any missed payments will affect both of your credit scores.
Loans for bad credit
Having little in the way of credit history or a bad credit score is likely to make it harder to get a Tesco loan. While Tesco Bank doesn’t specify in its eligibility criteria that a poor credit history will rule you out of qualifying for one of its loans, it makes clear that it does not offer bad credit loans, which are typically aimed at those with a poor credit history.
Don’t apply for loans you are unlikely to get because unsuccessful applications will have a negative effect on your credit score.
Flexibility
Tesco Bank offers one of the highest levels of repayment flexibility of all the lenders we’ve reviewed.
It’s possible to choose the date that your monthly direct debit payments are taken when setting up a loan. Keep in mind that this could alter the amount of interest you are charged.
In addition, if you are eligible, it may be possible to delay making your first loan repayment to Tesco for up to two months. Interest is charged during this period and two months will be added to the end of your loan term, which means you’ll pay more interest overall, but it’s an option which could provide some useful breathing space ahead of starting to pay back your loan.
Extra repayments
Tesco allows borrowers to make penalty-free overpayments at any time, giving you the chance to reduce the period of time you’re paying back the loan, which could save you interest overall. Alternatively, you can overpay and ask Tesco Bank to reduce your monthly payments going forward.
Additional payments can be made by bank transfer, through your Tesco online loan payment portal, via standing order or by cheque, so there should be an option to suit everyone. Some lenders have limits on how much you can overpay so always check the terms before doing so.
A Tesco Bank personal loan can also be paid off in full at any time during the loan term. Crucially, you will be charged the equivalent of two months’ interest, but even with this charge, it might mean you end up paying less interest overall.
Additional borrowing
It is possible to apply to borrow more from Tesco Bank but only after you’ve made eight monthly repayments in a row on the loan you already have.
Additional loans can be for between £3,000 and £35,000, but the most you can borrow in total is £35,000, taking into account the amount left outstanding on your current loan.
There are two routes to borrowing more:
- topping up your existing loan, which involves combining your existing and new borrowing into a new loan with a new rate and terms
- taking out a separate second loan to sit alongside your current loan
If you choose the first option and top up your loan, an early settlement charge will be added to your new balance.
The second loan option might be worth exploring if you have a low interest rate on your existing loan that you don’t want to lose. Unfortunately, however, it isn’t possible to take a second loan as a joint loan.
Both options will involve a credit check.
Any additional borrowing is likely to be assessed using your circumstances at that time rather than the details you initially provided.
Application process
Tesco Bank scores well for its loan application process, but several other lenders we’ve reviewed score slightly higher.
It’s possible to apply for a Tesco Bank loan either online or over the phone.
How long does it take to apply?
If you apply online and are approved, you’ll either be sent a credit agreement through the post to sign and return, or you might be able to sign a digital credit agreement. If you sign digitally, then you could receive your funds by Faster Payments within 24 hours of signing, although Tesco Bank says you should leave up to 48 hours before calling.
If you apply over the phone or are asked by Tesco for further documents, you’ll be sent a credit agreement by post along with details of any extra information you need to supply. Tesco says it could take between five and 10 days for it to work through and verify the documentation you return but if your application is approved, Tesco will send the money by Faster Payments.
If Tesco makes you a loan offer, you will have 30 days from the date you made the application to return the necessary documents, otherwise the offer will expire.
What information do I need?
Before sitting down to apply for a Tesco personal loan, it’s best to have to hand the following details:
- your bank account
- your regular income after tax each month
- your employer’s address (if you’re employed)
- the limits on any credit and store cards you might have and their current balances
- your regular monthly outgoings
- your address details for the past three years
» MORE: How to get a loan
Availability of customer support
Compared to its high scores in the other categories, Tesco Bank doesn’t perform quite as well for its availability of customer support.
You may be able to manage your Tesco loan through your online account or the mobile app, but there aren’t many options if you want to speak directly with a member of the customer service team.
Tesco Bank has an online community forum where you can ask questions to other customers and, for some issues, you may be able to ask Tesco Bank a question directly.
If you prefer more traditional methods of customer support, Tesco also provides phone support which is available seven days a week or you can write to the bank.
Customer ratings
Tesco Bank receives broadly positive customer reviews on Trustpilot, with a rating of 4.3 stars out of five across more than 34,700 reviews. This rating relates to its offering as a whole and not just its personal loans.
The Fairer Finance ratings are encouraging too, with Tesco Bank receiving an overall score of 72% and a ‘gold’ ribbon. This rating relates specifically to its personal loan product.
This information was correct as of 4 September 2024.
Am I eligible for a Tesco Bank loan?
To qualify for a Tesco loan, you will need to:
- be between 18 and 74 years old (or at least age 22 if the loan is to refinance existing debt)
- be employed and not in a probationary period, or have a separate regular income such as a pension
- have lived in the UK for at least three years
- have a UK personal current account.
You will also need to pass any credit checks that Tesco carries out as part of the application process.
You can check your eligibility for a Tesco Bank personal loan in a matter of minutes and without affecting your credit score on the bank’s website. A full credit check will only be made if you decide to apply for a loan.
Alternatively, you could consider using a loans eligibility service to conduct a soft search across multiple lenders. This will show you the likelihood of a successful application against several different loans, without affecting your credit score. But check the details of the service you use, to make sure it only uses soft searches and how many lenders it checks.
» MORE: Am I eligible to get a personal loan?
Frequently asked questions
You’re likely to stand a better chance of getting a Tesco Bank personal loan if you have good credit, although other factors such as your earnings and employment will also be important in determining if you’re offered a loan. It’s also worth noting that Tesco Bank does not offer specific bad credit loans.
Applying for a Tesco Bank loan has the potential to affect your credit score, but simply checking your eligibility for a loan will not. If you already have a loan, your credit score could be negatively impacted if you fail to make repayments when you should.
Review methodology
At NerdWallet UK, we base our reviews and our ‘Best’ pages on the results of surveys we undertook about what was important to people who use these products. This allows us to look at products impartially of any commercial arrangements we have and fairly rate the products on the same set of criteria.
Best means our ‘Best’ and is based only on what products we have aligned to our surveys, which form the basis of our reviews and ratings. This means that there will be other products on the market that we have not included in our ‘Best’ pages. Best does not mean it’s best for you, nor does it mean the ‘cheapest’.
Our reviews may display lenders’ rates. This additional information has not been included in our evaluations but is still very important when choosing a product. Rates offered can depend on circumstances, amount and term. Always check details before proceeding with any financial product.
Product details reflect the information that was available at that time but may have changed since. We strive to give you a review on as many products as possible, but there will be products not included on the market. The review is our opinion, but it does not constitute advice, recommendation or suitability for your financial circumstances.
While we try to provide you with accurate information, the providers can change the terms of their products at any time, therefore it is advisable to check the terms before you proceed.
You can view our full review methodology here.