The banking arm of supermarket giant Sainsbury's will step up the pressure on high street banks this week as it launches two new credit cards.
Sainsbury's Bank, a joint venture between Sainsbury's and Lloyds Banking Group set up in 1997, will launch a credit card based around its Nectar points award scheme, while the other is a new cashback card.
The bank, which offers loans, insurance and savings products, grew pre-tax operating profits by 40% in the financial year 2011/2012, which it puts down to linking its products with the Nectar scheme.
Hannah Bernard, Interim Chief Executive, Sainsbury's Bank said: "With the strength of our brand, the fact that we have developed a very robust and proven reward proposition for our customers, and with around 25% of all retail credit card transactions taking place in supermarkets, now is a very exciting time to launch a new credit card proposition."
The Sainsbury's Nectar Credit Card will enable shoppers using their card in-store at Sainsbury's to earn up to five times the number of points normally earned - 10 points earned per £1 spent - in the first three months, equal to up to 5% off a customer's shopping.
After this, Sainsbury's shoppers could earn rewards equivalent to 2% off their shopping.
Meanwhile, the Sainsbury's Cashback Credit card offers 5% cashback on purchases made in-store at Sainsbury's for the first three months, up to a maximum of £1,000 spend per month.
After the introduction period, card holders could receive a further £5 cashback each month when they spend at least £250 at Sainsbury's and at least £250 at other outlets.
The bank, which is headquartered in Edinburgh, has 1.4 millions active customers.