When the British supermarket chain J. Sainsbury plunged into financial services in 1997, it was guided by a simple observation: "People didn't have one good thing to say about banks," says Richard Chadwick, deputy chief executive of Sainsbury's Bank. "There was a huge opportunity there."

For close to two years now, the giant grocer and its largest rival, Tesco PLC, have been hawking everything from savings accounts to personal loans to credit cards. Together, they have captured some $4 billion in deposits-without investing in a single bank branch.

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