Coles has begun its much-prophesied venture deeper into financial services after announcing a new deal with GE Capital.
The supermarket giant hinted earlier this year about its plans to expand its financial services offering. Coles has now announced a 50:50 joint venture with GE Capital Australia that will see it offering "credit cards and personal finance products". The business is due to commence operations next year, subject to regulatory licensing and approvals.
"The joint venture will leverage new payment technologies, including the recently announced Coles Mobile Wallet, to deliver innovative financial services to the Australian market. Coles financial products offered through the joint venture will also provide customers with additional value and benefits of flybuys’ award winning loyalty program, including money off your groceries at Coles," the supermarket said in a statement.
Coles already holds 400,000 Coles MasterCard customer accounts, and offers motor, home and life insurance products. In a submission to the Financial Systems Inquiry earlier this year, Coles finance director Rob Scott hinted that the retailer could look to move into mortgages.
At the National Mortgage Brokers annual conference in April,
Aussie Home Loans executive director James Symond said it was inevitable that new players would be drawn into the mortgage industry, and that competition in the future would come from non-traditional sources.
“Mortgage broking is growing. It’s growing because of the model, because of the service and because of choice. It’s also growing because there’s margin still to be made by the lender and by the broker. That means more lenders want to come into the industry. That also means more distributors like Coles and Woolworths and others will want to come into the industry,” he said.
