MONTERREY, Mexico, Jan 27: Mexican retailer Soriana said on Friday it plans to enter the banking business, an increasingly competitive battleground for store operators fighting for millions of low-income customers.

A growing list of store chains, including industry leader Wal-Mart de Mexico, already have said they plan to launch their own banks or credit businesses to lend to their customers.Aurelio Adan, Soriana's chief financial officer, told Reuters his company would now jump into the market. Soriana's shares closed higher after the news.

"We are figuring out what kind of deal we want: whether we pursue a joint venture with a bank, or we apply for a banking licence," Adan said.

Soriana hopes to have its strategy defined in about two months, he added.Mexico's big financial groups have stepped up lending to clients in recent years, but low-income Mexicans who would not be eligible for most bank loans remain an underserved segment of the market.

"If we look at Brazil and Chile, Mexico is way below them (in consumer lending). There's a huge potential in this sector," Adan said. "Besides, we have competition: Coppel, Famsa, Wal-Mart are doing it."Soriana shares closed up 6.81 per cent at 90.33 pesos in Mexico City following the announcement.

Wal-Mart de Mexico, controlled by Wal-Mart Stores Inc. plans to open its own bank in the second half of this year.—Reuters