Tesco Bank loans review

6 min Read Published: 20 Mar 2024

Tesco bank LoansTesco Bank offers unsecured loans of £1,000 to £35,000 that can be repaid over 1-10 years. It often features towards the top of our 'The best personal loans' page and offers the option to check your eligibility without the need to submit a full application that would then appear on your credit file. In this independent review, you can learn more about the key features of a Tesco Bank loan to help you decide if it is the right option for your borrowing needs.

What are Tesco Bank loans?

As well as being a leading retailer in the UK, Tesco also has a banking arm - Tesco Bank - which offers a variety of services, including loans. Potential borrowers can apply for a loan directly with Tesco Bank and if they have a good credit score and are approved, they can enjoy competitive interest rates. Keep in mind that as with many unsecured loan providers, you will pay a high rate of interest if your loan amount is below a certain threshold.

Tesco Bank loans stand apart from many competitors because of the relatively high maximum it will lend as an unsecured personal loan, as well as additional features, such as the ability some borrowers have to defer their first repayment by 2 months at the start of the loan period. You can also get a better rate by signing up for a free Tesco Clubcard.

Tesco Bank loans - key features

  • Personal loans for between £1,000 to £35,000
  • Repayment periods between 1 to 10 years
  • 6.1% APR representative (lowest rate is available for Clubcard members on loans from £7,500 - £25,000, over 1 - 5 years)
  • Potential for a 2 month payment break for some borrowers
  • Not available to those with poor credit scores

What types of loans does Tesco Bank offer?

Tesco Bank provides unsecured personal loans, which means the debt isn't secured against a valuable asset, such as your property. This reduces the risk of losing that asset if you can't keep up with the repayments, although the debt could be passed on to a debt recovery agency if you persistently miss payments.

Tesco Bank does not provide secured loans or guarantor loans, but if you are interested in these types of loans we have more information in our article 'Which is the best type of loan for you?'.

How much can I borrow with a Tesco Bank loan?

Tesco Bank provides loans between £1,000 to £35,000, which is a relatively high amount for an unsecured loan, though competitors including Sainsbury's will lend more.. The average maximum personal loan for a high street lender is around £25,000. The exact amount you can borrow, however, will be determined by how affordable the repayments are and your individual circumstances, which Tesco Bank will assess as part of the application process.

How much does a Tesco Bank loan cost?

The APR on a Tesco Bank loan ranges from 6.1% through to 19.1%, depending on the loan size, and is subject to status. The representative example it provides is that a loan for £10,000 paid back over 60 months at an APR of 6.1% would require monthly payments of £193.02. The total amount repaid is £11,581.20, of which £1,581.20 is interest.

The longer the repayment period, the smaller the monthly repayments but the greater the total amount of interest payable, which means the loan becomes more expensive the longer you have it. You should always seek to take out a loan for the smallest amount possible and repay it in as short an amount of time as possible to minimise the cost.

Am I eligible for a Tesco Bank loan?

The following key criteria must be met in order to be approved for a Tesco Bank loan:

  • You must be over the age of 18
  • You must be aged under 75 at the end of the loan term
  • You must be in employment or have a regular income
  • You must have been living in the UK for at least 3 years
  • You must have a UK bank account

In addition, Tesco Bank doesn't offer loans to people with poor credit, which means you need to have a good or excellent credit score with the three main credit reference agencies, Equifax, Experian and TransUnion as Tesco Bank refers to all three when making its decisions.

How do I apply for a Tesco Bank loan?

Before starting the full loan application process, Tesco Bank has an eligibility checker, which performs a soft search of your credit files but without leaving a "footprint" or being visible to other lenders. You will then be given a percentage score to indicate how likely you are to be approved for the loan if you go on to complete a full application. However, even if you are given a high percentage score, this doesn't act as a guarantee that you will definitely be approved. Loan approval will depend on the results of a full credit check, as well as fraud prevention measures and scrutinising whether you meet the basic eligibility criteria, including being between 18-74 and having lived in the UK for the previous 3 years.

How long does Tesco Bank take to pay out?

The speed at which you receive the money after you have been approved for a loan depends on how you apply. If, for example, you apply online and are immediately accepted, you can opt to sign your credit agreement digitally and then the money will be sent to your nominated bank account through the Faster Payments system. Faster Payments takes a maximum of 48 hours and once the money has been deposited, you are free to withdraw it immediately.

Alternatively, if you apply for the loan over the phone and you are sent a physical copy of your credit agreement to sign, or if you are asked to provide further documentation to support your application, it can take between 5-10 days for these to be processed before you are sent the money.

Can I repay my Tesco Bank loan early?

If you wish to increase your repayments or make additional payments, you can do so and reduce the overall term of the loan without having to pay any fees. If, however, you want to resettle the loan in full before the end of the term, you may be liable to pay up to 2 months' interest as an additional fee. The exact amount will depend on how much you have outstanding on your loan and the time remaining on the term.

Is Tesco Bank safe?

Tesco Bank is authorised and regulated by the Financial Conduct Authority (FCA), which means borrowers have access to the Financial Ombudsman and Financial Services Compensation Scheme. This gives a good level of protection in instances where things go wrong.

However, Tesco Bank was singled out as one of the worst performers in terms of online security, according to the results of research conducted by Which? at the beginning of 2021. Since then, the bank has addressed the security concerns highlighted in the report and made changes where appropriate to safeguard customers against cyberattacks.

Tesco Bank loans pros and cons


  • Capacity for some borrowers to get loans for up to £35,000, which is higher than average for unsecured personal loans in the UK
  • Borrowers can overpay the loan, without paying additional fees, which will serve to reduce the term of the loan and the total amount you will pay in interest
  • There is the potential to have a 2-month payment break at the start of the loan, which means you wouldn't have to make your first repayment until the third month after the loan is issued. This is subject to approval and won't be available for all borrowers


  • While some lenders promise to pay out the loan on the same day it is approved, Tesco Bank has a turnaround time of 48 hours, on average
  • If you have an impaired credit history, you are highly unlikely to be approved for a loan
  • You may have to pay a charge of up to 2-months interest if you want to repay the loan in full before the end of the term

Tesco Bank customer reviews

According to independent customer review site Trustpilot, Tesco Bank score 4.0 out of 5.0 stars based on almost 6,000 reviews. It means that, overall, it is ranked as a "great" company, with specific praise for its customer service, although the reviews cover all of its services, not just loans. While 52% of respondents state the bank is "excellent", a further 29% believe it is "bad". The negative reviews are also centred on customer service, as well as frustration from individual customers at being turned down for loans.

Summary: Should I take out a Tesco Bank loan?

Tesco Bank loans are competitively priced and are, therefore, attractive to borrowers. However, you need to keep in mind that your loan application is unlikely to be approved unless you have a strong credit history, although it is possible to check your likely eligibility before making a full application.

You can compare more personal loans options on our 'Compare personal loans' page.