SINCE the credit crunch began to bite, some of Britain’s High Street banks have been staggering around like stumbling heavyweights awaiting a knockout punch to put them out of their misery.

Could that moment arrive when Tesco, Britain’s biggest retailer, which has announced £3bn annual profits and a 30 per cent share of the UK grocery market, decides to open bank branches in many of its stores offering current accounts to six million customers?

Since Tesco paid Royal Bank of Scotland (RBS) about £950m last year to take 100 per cent control of Tesco Personal Finance, its determination to use personal finance as a platform for future growth has been plain.

Andrew Hagger, current accounts analyst at Moneynet.co.uk, said if Tesco enters the current account market, traditional players will have to be at the top of their game on rates and customer service.

This year, Tesco will take the banking and insurance centre, trialled in its store at Silverburn, Glasgow, to 30 more stores across Britain, selling 28 products and services in general insurance, credit cards, loans and savings. The first in-store banking centres will be in Blackpool, Coventry and Bristol.

The Tesco Internet account is among the better paying instant access accounts – paying 1.5 per cent, plus a one year one per cent bonus.

But the message from Tesco HQ is that a current account launch is likely “within two years”, with a move into mortgages also probable.

“If it is be a real threat to existing suppliers, Tesco must offer an account which can be operated online, and is straightforward on fees and charges,” said Mr Hagger.

“People need to know exactly how much they are paying on overdrafts, and for how many days.”

He says the credit crunch means more people are using an overdraft limit to survive from one payday to the next – but many don’t know what it is costing them.

Moneynet.co.uk research shows the average authorised rate for overdrafts is 14.4 per cent, although some current accounts charge a daily fee rather than an interest rate.

The Halifax Reward current account charges £1 per day for authorised overdrafts to £2,500, and £2 per day on £2,500 plus (this latter account also pays £5 credit per month, if funded with the required minimum £1,000 per month).

“Choose an account to suit your own spending profile,”

advised Mr Hagger.

“If you are regularly in the red, switch to a deal where charges are lower. Don’t be swayed by credit interest rates, because you won’t reap the benefit.”

He thinks customers using their overdraft regularly should consider the Alliance & Leicester Premier Direct bank account, which offers free overdrafts for the first year.

For those able to pay £1,500 per month into an account, First Direct offers £100 for people switching to its 1st current account, and a £250 interest-free overdraft limit, which is available indefinitely.

For current account holders usually in the black, Moneynet best buys include Halifax Reward Account (minimum monthly funding of £1,000); Alliance & Leicester Premier Direct account (£500) and Abbey Current-Credit option (£1,000).