Sainsbury’s has agreed to sell its Argos credit card portfolio NewDay Group as it continues to offload its banking services.
The deal with the credit firm is expected to be worth £720m, in line with the expected net value of loan balances at the end of the first quarter next year when the deal will complete.
The supermarket chain said the portfolio supported 20% of Argos sales and are used by some two million customers to manage the cost of their purchases.
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The transaction will also see Sainsbury’s partner with NewDay to create a new Argos-branded digital credit proposition, which will replace the brand’s current credit propositions with a “wider choice of modern, flexible and more convenient ways for customers to manage the cost of purchases”.
Sainsbury’s CEO Simon Roberts said: “As we make progress with the plan for Next Level Sainsbury’s, this is a key milestone in building our future model for financial services.
“It’s really important we work with partners who share our values and customer focus. 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.”
Earlier this year, Sainsbury’s announced it was offloading most of its banking arm to Natwest Group in a deal that will complete in the first half of next year.
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