Would-be bank customers are in effect being offered a bribe of £160 a year to sign up with Lloyds TSB. In a deal announced yesterday, Lloyds has linked up with ScottishPower and Cable & Wireless to offer gas, electricity and telephone services through its 2,000 branches - but only to bank customers.
Peter Ayliffe, group executive director of Lloyds' UK retail banking, said: "Hundreds of thousands, if not millions, of UK consumers are paying over the odds for these essential services and we're using the strength of our buying power to get them a better deal. The new service, called Ideal from Lloyds TSB, will give both new and existing Lloyds TSB current account customers the opportunity to make sizeable savings on their monthly bills."
A spokesman estimated that there would be an 18 per cent saving on energy bills, which would amount to £110 a year for the average customer, and 20 per cent on the standard BT telephone tariff, equal to £50 a year. International calls would be as much as 50 per cent cheaper.
Customers will receive one monthly bill combining the charges for the services they choose, and Lloyds will switch suppliers on customers' behalf.
The new service, which has been piloted in Chester and Wolverhampton, will be available in all Lloyds branches by 15 August. The plan is to extend the service to telephone and internet inquiries eventually. Anyone who wants to take advantage of the scheme can do so after opening a Lloyds current account.
But, while Lloyds has negotiated the special prices and will handle the paperwork, it is taking no responsibility for any hiccups.
Lloyds said yesterday: "In the event of emergencies, customers should contact Transco for gas leaks and their local public electricity supplier for electricity issues, such as power cuts."
No other high-street bank is providing this service, but if the Lloyds plan succeeds analysts expect others to follow.
Mr Ayliffe added: "Our customers have told us this is exactly the kind of service they want and by offering them a combined bill paid by direct debit, we're also making their lives simpler."
Lloyds TSB shares rose 12p to 471p yesterday.
The deal comes ahead of Lloyds' half-year results this Friday, when Eric Daniels, the bank's new chief executive, is expected to unveil more details of his strategy to boost revenues by improving core retail banking services in a bid to try to sell more products to each customer. However, Lloyds is also likely to admit it has made a provision to pay for mis-selling claims from customers who bought its Extra Income and Growth Plans.
There has been speculation that the Financial Services Authority may fine Lloyds over the sale of the products, known to critics as precipice bonds.
Lloyds is widely thought to have ruled out cutting its dividend as a way of conserving capital. Mr Daniels has instead indicated he would raise capital by disposing of assets such as the New Zealand Brazilian banking businesses. The bank may also put its life arm, Scottish Widows, on the block if Mr Daniels believes it is not contributing enough to the group's profits.
- More about:
- Lloyds TSB