Tesco plan to sell mortgages delayed by FSA

TESCO’S plans to sell mortgages in Britain could face a delay because it has yet to receive approval from the country’s financial services watchdog.

“The FSA (Financial Services Authority) is just being careful. It is a new process and it is very difficult,” a Tesco spokesman said.

He declined to comment on a report in a Sunday newspaper that Tesco’s plans to enter the home loans market could be delayed by up to 12 months.

Tesco, Britain’s biggest retailer, had originally hoped to start selling mortgages late this year. However, it was recently reported that the group was aiming to launch a home loans product in March.

The company, which reports first-half results tomorrow, is building up its banking and insurance business, and is expected to launch a fixed-rate savings account later this month, and a current account next year.

Only last week Tesco Bank, which is led by Benny Higgins, agreed a £59m deal that will see Fortis UK provide travel insurance to some 170,000 customers each year. A year ago the pair announced a similar tie-up on motor and household insurance.