"It's a very promising start, but it's only a start," said Simon Samuels, banking analyst at Dresdner Kleinwort Benson. "Sainsbury has been picking the low-hanging fruit straight way. But I suspect it was pleasantly surprised by the take-up, as Tesco and Prudential have also entered the market for depositors."
Sainsbury's Bank, 55 per cent-owned by Sainsbury and 45 per cent by the Bank of Scotland, attracted more than 100,000 customers who have deposited pounds 100m since it opened eight weeks ago. Its 10,000 new customers a week compares with 12,000 a month for FirstDirect, traditionally the fastest- growing bank in the UK. Tesco's bank attracted 190,000 customers in its first eight months.
Sainsbury's offers two accounts and two credit cards. Its Instant Access Savings account, which offers 5.75 per cent interest on balances over pounds 1, has been the most popular product.
Sainsbury had benefited from a receptive customer base and a market-leading interest rate, Mr Samuels said. "It's a stonking rate of interest. But it's not clear whether Sainsbury can maintain it across an entire product range."