Mobile by Sainsbury’s, the supermarket chain’s new virtual mobile service, is being switched on today, promising to double the number of Nectar points its customers receive provided they add credit to their phone.

The new service, which was announced at the beginning of the month but hasn’t been live until today, is currently only offering Pay-As-You-Go deals on two tariffs, which it says keeps things nice and simple for the customer.

The Basic plan offers calls at 8 pence per minute, texts at 4 pence each and data at a cost of 50 pence per day for up to 25MB. That’s it. The other ‘Bundle’ plan does as its name suggests and offers bundled minutes, texts and data for a set one-off cost. A breakdown below:

  • £10 Bundle:  200 minutes, unlimited texts and 250MB of data
  • £15 Bundle:  300 minutes, unlimited texts and 500MB of data
  • £20 Bundle:  800 minutes, unlimited texts and 1GB of data

There’s also a ‘borrow a pound’ option for those sticky situations where you have no credit, but you also can’t top-up right there and then. The pound’s worth of credit, plus a ten pence fee are then deducted when you next top up.

The double Nectar points offer applies to people that buy Mobile by Sainsbury’s bundles and top-ups, but applies all across the store and for fuel purchases too. The minimum top-up is £5.

As Sainsbury’s obviously doesn’t own any of the infrastructure required to run a service, it’s doing so in conjunction with Vodafone to add technical prowess and customer support to the service.

Sainsbury’s said its SIM cards will be available in all of its stores, and that more than 250 of those stores will also stock a range — all of which are at the ‘value’ end of the scale — of handsets ranging from the £12 Nokia 100 to the Galaxy Fame for £115.

The move from the retailing giant puts it in competition with other MVNOs (mobile virtual network operator) such as GiffGaff and The Peoples’ Operator, but also more directly with rival services from other supermarkets like Tesco and Asda. With competition heating up in the MVNO space in the UK, it’ll be harder for Sainsbury’s to keep a handle on customer loyalty, providing it can gain any critical mass at all. However, with a nationwide network of hundreds of stores and a brand name people recognize, it already has a head start over some of the smaller services.

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