In a staff memo, the bank says the move will affect employees in its group operations and IT departments, general insurance and its Cheltenham and Gloucester unit. The bank says a small number of staff will lose their jobs but many employees should be redeployed within the group.

Lloyds TSB also insists that the bank's operations in India are performing at UK levels and are as secure as British centres.

Earlier this year the bank was accused of by its staff union of breaching the the Data Protection Act by transferring customer financial data to overseas centres without their consent. But in the memo the bank stresses that customer databases are held in the UK on the bank's computers and not in India.

But Lloyds does admit that some customers are against offshoring and says it will be putting a leaflet in its branches from next week explaining the offshoring operations.

"We know that some customers are initially against the idea of their bank carrying out work offshore. However, research we have recently carried out with customers shows that, if we explain what we're doing, how we're doing it and the potential benefits, then many become more comfortable with the idea"

Financial services union Unifi says it was consulted over the plans. An agreement signed by the bank and the union earlier this year commits Lloyds TSB to offer affected staff alternative jobs and retraining opportunities.

In a statement, Iain MacLean, an official at financial services union Amicus, says: "We always regret any jobs going abroad and we will be pressing the company to ensure that any staff whose jobs have gone who wish to stay with Lloyds TSB are offered alternative work."