Tesco is all set to lure customers with roll out of “pay day” discount strategy which will help customers ward off effects of credit crunch.

The UK supermarket giant will make huge offers to shoppers at the end of every month when their bank accounts carry maximum cash.

According to City source this is a smart move by Tesco. After buying RBS from its Personal Finance venture, it is strongly placed to look at financial trends. Since many of Tesco’s customers are struggling, this was a better option for them to spend a bit more when they were feeling flush. It is expected that discounts will be offered on household items, which customers normally resist purchasing at later dates.

According retail analyst, James Monro, at S&P Equity Research, this strategy is aimed at holding back those consumers who are switching over from Tesco to other rival stores. This may tempt Tesco shoppers to spend more in buying discounted items at the end of the month.

Tesco’s discount scheme was launched in September 2008 to prevent customers from turning to Lidl and Aldi, the low-cost rivals which reaped big gains recently.

Although Tesco sales grew by 2.5% during key Christmas trading, it was its worst performance since recession in 1990s.