Tesco bank is a good option if you wish to borrow a lump sum over a particular period and then pay it back via fixed monthly installments. Tesco is a well-known UK retailer and offers financial services in the form of Tesco Bank. You can apply for a loan directly if you have a good credit score. When you get approved for the loan, you can benefit from competitive interest rates.
Tesco Bank is regulated and authorized by the Financial Conduct Authority. This indicates that borrowers have access to the Financial Services Compensation Scheme and Financial Ombudsman. This ensures protection in the event of unfortunate circumstances.
Features of Loans Offered by Tesco Bank
- Tesco bank offers personal loans starting from £1,000 up to £35,000 (a high amount for an unsecured loan). The exact amount you are eligible to borrow depends on the affordability of repayments and individual situation.
- APR ranges 3.2% to 32.5%.
- The bank offers a payment break of 2 months to the borrowers.
- You cannot apply if you have poor credit scores.
- Tesco Bank offers personal loans between repayment periods between 1 to 10 years
Applying for a Tesco Bank Loan
Before you initiate the loan application process, you should use Tesco Bank’s eligibility checker, which will carry out a soft search of your credit files. It will give you a percentage score to give you an idea regarding the probability of you getting approved for the loan.
However, despite getting a high percentage score, there is no guarantee that you would get approved for the loan. Loan approval is determined by the results of a complete credit check. Also, it will be examined if you meet the basic eligibility criteria (living in the UK for 3 years and aged between 18-74 years).
Eligibility
- To apply for Tesco Bank, you need to:
- Have lived in the UK for a minimum of three years.
- Aged between 18 and 74.
- The borrower should have a regular income source like a salary or pension.
- The borrower should be at least 22 years the purpose of applying for a loan is to consolidate another debt.
- You should have a good or excellent credit score with Equifax, Experian, and TransUnion, as Tesco Bank gets refers to these three credit reference agencies.
Types of Tesco Bank Loans
You can get unsecured personal loans from Tesco Bank in which the loan is not acquired against any valuable asset. This minimizes the risk of losing that asset in case you are unable to manage the repayment. If you are continuously missing out on payments, the debt can be handed over to a debt recovery agency. There are no secured or guarantor loans by Tesco banks.
Cost of Loan by Tesco Bank
The APR on the loans starts from 3.2% to 32.5% according to the size of the loan. The longer the repayment period, the smaller monthly installments you have to pay. But the interest payable is greater. This makes the loan costlier the longer you have it.
It is best to take out a loan for the smallest amount and repay it in the shortest duration to reduce its cost.
Knowing the basics beforehand makes it easier to apply for a Tesco loan.
