Cancelling monthly direct debit - any credit implications?

Glastoun

I'm on nPower's Online October 2014 fixed tariff, and they've bumped up my monthly payment from £21 a month to £252 (!) a month. Last February we used 1000kwh of gas, but they've estimated that we'll be using 4000kwh of gas in November and each month throughout the winter. Clowns.

I've already put in a switch to another supplier because nPower have gone shambolic over the last year or so, but if I cancel my direct debit so they don't take £252 at the beginning of October, will there be any fallout from that? Are there account conditions that stipulate the direct debit must remain in place else there are penalties? Could I make an ad-hoc payment to put my account in credit, then presumably they wouldn't have any complaints?

Bluebirdman_of_Alcathays

I haven't read the t's and c's for your particular tariff, but normally cancelling the DD makes the contract null and void (for DD only tariffs), and you will revert to standard tariff from that date.

£21 is ridiculously low, and barely covers the standing charge for a year. If I were in your shoes I'd just call them, get the DD amended to something reasonable, and await the final bill with trepidation....

nightswimming

The October 2014 tariff requires an active DD. If you cancel it they will automatically transfer you to their standard tariff which is more expensive. If you are switching soon it might not make a huge difference though. I would submit a meter reading so they can't charge for too many units at the higher rate.

Have you had a recent bill? Are you in credit or do you owe them? From the very low previous payments and the large increase it looks like you owe them and the increase is to not only cover your usage but make up for previous underpayment.

Glastoun

I changed my direct debit date to the middle of the month, hopefully they'll have processed my request to reduce the direct debit amount by then. If not I'll just cancel the DD as the switch should be almost completed by then. As long as it's just a change to standard tariff then that's fine, it won't be much difference for a week or so.

And thanks for the inferences on my account management, but none of it was correct. We're not here half the time so our bills are lower than if we were here all through the week - the direct debit has been £21 since last November and we're £4 in credit so we must be doing something right. I can't attach nPower's useage estimate chart, but like I said they've taken it from 1000kwh gas per month last winter to 4000kwh this winter, so that's where the big increase has come from.

Thanks for the DD advice,

Buzby

It certainly doesn't make the contract 'null and void' - if only if would! (They could not enforce payment). You've just entered into a payment scheme and if you don't make the payments you should revert to standard billing.

This must be paid on presentation. Usually easier to request they do this, and you control when the payments are made.

spiro

If they credit report then you'll you'll probably get a black mark for the failed dd.

Glastoun

spiro wrote: »

If they credit report then you'll you'll probably get a black mark for the failed dd.

But the account is in credit, so there's no debt to declare, all the bills that have been issued have been paid.

I kind of agree with the reverting to standard billing though - if the current pricing is based on having a monthly direct debit, and this is cancelled, then that pricing wouldn't be available to me any more.

I guess I could have checked the T&Cs from when I opened the account, but this way is more fun.

GingerBob_3

Glastoun wrote: »

But the account is in credit, so there's no debt to declare, all the bills that have been issued have been paid.

I kind of agree with the reverting to standard billing though - if the current pricing is based on having a monthly direct debit, and this is cancelled, then that pricing wouldn't be available to me any more.

I guess I could have checked the T&Cs from when I opened the account, but this way is more fun.

That is an excellent point, and one which I've been wondering about with my own situation - well in credit, so what would happen about CRA reporting if I stopped a DD?

I don't expect a speedy answer on this one, and my suspicion is that they report it to the CRAs as a missed payment. In my view, if they do so, it is wholly wrong and it shouldn't be allowed.

macman

If you'd rather avoid the DD going out then cancel it and pay Standard tariff for the short period until your switch completes. The difference will be minimal.
It's your choice between a lower ultimate bill or better cashflow.

bengal-stripe

Glastoun wrote: »

But the account is in credit, so there's no debt to declare, all the bills that have been issued have been paid.

Are all these bills (or at least the last one) based on estimates or actual readings? If they are estimates, they could be miles out.

Check your meter and see if the most current bill corresponds with your actual consumption.

Glastoun

bengal-stripe wrote: »

Are all these bills (or at least the last one) based on estimates or actual readings? If they are estimates, they could be miles out.

Check your meter and see if the most current bill corresponds with your actual consumption.

Yes meter readings given just before last bill.