Tesco has launched a new price-matching offer that could see customers given an immediate discount at the till instead of redeemable vouchers.

The supermarket giant's Brand Guarantee will compare prices on branded goods against Asda, Sainsbury's and Morrisons, and shoppers will see their bill reduced if goods cost less elsewhere - even if they are on sale.

The Brand Guarantee will not include discount chains Aldi and Lidl.

Tesco UK and Ireland chief executive Matt Davies said the supermarket decided against redeemable vouchers as customers found these to be a hassle, with many either losing or forgetting to use them.

"We all know it can be stressful and awkward when you have to rummage through your wallet to find a price match voucher," he said.

"That is why we are ensuring that with Brand Guarantee customers will never lose out on their branded shop by getting money off their bill at the till."

It marks the latest salvo in the ongoing price war as the supermarkets vie to undercut rivals and bring more shoppers through their doors.

Tesco will hope its latest offer helps revive its ailing fortunes. The supermarket giant continues to lose market share to the booming discount chains, and last week it reported a 70% drop in half-year earnings.