Argos card: UK supermarket Sainsbury’s sells credit card business to focus on food – what it means for you

• Sainsbury’s is selling its Argos credit card business for £720 million
• The credit card portfolio will be acquired by NewDay Group
• Argos credit cards support about 20% of the retailer’s sales, with approximately two million customers
• The cards offer various credit plans and buy now, pay later options, but carry a 34.9% interest rate on unpaid balances
• Argos cardholders won’t need to take action, and new digital credit offerings will be introduced over time

Sainsbury’s has announced its decision to sell its Argos credit cards business for £720 million, as the retailer shifts its focus away from financial services to concentrate more on its food operations.

Argos, a subsidiary of Sainsbury’s, relies on credit cards for approximately 20% of its sales, with around two million customers using these cards.

The credit cards provide shoppers with various credit plans and buy now, pay later options to help them manage their purchasing expenses. Customers are charged 34.9% interest on any remaining balance if they do not pay in full on time.

The credit card portfolio will be purchased by credit provider NewDay Group, and Sainsbury’s said the partnership will see the creation of new Argos-branded digital credit offerings, which over time will replace current credit cards with a wider array of spending options.

Argos card customers will not need to take any action as a result of the announcement, the firms confirmed. Their current credit arrangements will continue as normal.

Simon Roberts, Sainsbury’s chief executive, said the sale was a “key milestone” for the group, adding: “NewDay is a complementary fit for us as we strive to give customers at Argos the best value and choice and make it as easy as possible for them to buy the products they need.”

The agreement comes several months after Sainsbury’s struck a deal with NatWest to sell the bulk of its banking business, including personal loans, credit card balances and customer deposits.

It also recently agreed to sell its roughly 1,370 ATM machines to operator NoteMachine. The chain has stressed that it wants to home in on its main grocery business as part of a “food first” strategy.

We’d love to hear your thoughts on Sainsbury’s recent sale of the Argos credit card business! How do you feel about the shift towards new digital credit offerings? Share your opinions in the comments section.