Sainsbury has vehemently denied it is to ditch its Nectar card and is instead expected to try to revive interest in the scheme.

The retailer told The Grocer that it had a fixed term contract and that the renewal date was a long way off.

There has been mounting speculation that the company was in talks with Nectar operator Loyalty Management UK (LMUK) about future participation in the scheme.

Sainsbury chief executive Justin King is on record as saying the running costs equate to half the supermarket chain’s marketing budget

A spokeswoman said: "With Nectar, Sainsbury shoppers can benefit from a loyalty card they can use at other top UK retailers - unlike at other supermarkets.”

“This enables customers t earn points more quickly, making it easier to save for bigger rewards.”

But critics say Sainsbury’s financial performance speaks for itself and that it would be better to invest the running costs back into price.

“It’s just a points scheme so is it going to add anything significant to Sainsbury? Loyalty schemes are the chocolate on top of the cappuccino, you have to have everything else working properly to get any benefits,” said Nigel Lawrence, loyalty and communications expert with consultancy Lawrence Pritchard.