Energy companies deposits rant

dadsgoneshopping

So, Sainsbury's energy have asked me for a huge deposit to switch, after speaking to different people on their unhelpful line, it basically boiled down to take it or leave it.
So, my understanding is that basically, they are getting a large interest free loan from their customers. Immoral? Illegal? So starting with Sainsbury's imagine they only have 100,000 customers. A £200 deposit from each equates to an interest free loan of £20 million. How on earth are they allowed to do this? How can the regualtor allow this? If they must ask for a deposit, then it should be capped at a month's or perhaps two months bill.

I dislike first utility as they have terribel customer service, but I don't feel like loaning Sainsbury's this money, robbing barstewards that they are.

dadsgoneshopping

I also dislike the fact that I can't spell terrible, terribly well.

Kunfuslippers

Not every customer is being told to pay the deposit, it's a random choice thing. i spoke to a friend who has a clean credit score who got told to pay it, yet another friend who's credit rating is horrendous got on it free of charge.

If it was down to credit rating or billing history then it's something that i would agree with. as it's just a random choice thing...it's a bit silly

Cardew

http://www.adviceguide.org.uk/wales/consumer_w/consumer_energy_supply_e/problems_switching_energy_suppliers/the_energy_company_wont_supply_you_without_financial_security.htm

If you’re asked to put down a deposit

The maximum deposit you can be charged is the two highest quarters of energy used, which will be estimated if necessary. The supplier must only request a ‘reasonable’ amount as a deposit. If you believe that the amount of the deposit is unreasonable, take the matter up with the supplier. If you are still not satisfied, you can make a complaint.

The energy supplier will review the deposit after one year. If the bills have been paid in full, your deposit will be returned within two months of the end of the year.

Two winter quarters will be around £600 for an average user; so it is legal, and IMO ethical!

A customer is asking a company to give them several hundred pounds credit. Given that some people think that paying Utility bills is optional! it is not surprising that in some circumstances utility companies ask for a deposit.

Nada666

Where you have a credit meter it is you, the customer, who is being given an interest free loan - whether a month or a quarter at a time; or over twelve months (and even longer) if arrears do accrue - in all three cases with zero interest to be paid to the supplier by the customer.

And the deposits are not cost-free to the supplier - they are returned, with interest, to the customer.

dadsgoneshopping

no, I asked, Sainsburys do not pay interest, otherwise I wouldn't be so unhappy

Kunfuslippers

Personally, I agree with the idea on customers who have a record of missing bills and ending up in debt with their current/previous suppliers.

People like myself who's never missed a payment and have a green credit rating shouldn't have to pay it in my opinion.

Bluebirdman_of_Alcathays

Kunfuslippers wrote: »

Personally, I agree with the idea on customers who have a record of missing bills and ending up in debt with their current/previous suppliers.

People like myself who's never missed a payment and have a green credit rating shouldn't have to pay it in my opinion.

What's a green credit rating?

footyguy

dadsgoneshopping wrote: »

So, Sainsbury's energy have asked me for a huge deposit to switch, after speaking to different people on their unhelpful line, it basically boiled down to take it or leave it.
So, my understanding is that basically, they are getting a large interest free loan from their customers. Immoral? Illegal? So starting with Sainsbury's imagine they only have 100,000 customers. A £200 deposit from each equates to an interest free loan of £20 million. How on earth are they allowed to do this? How can the regualtor allow this? If they must ask for a deposit, then it should be capped at a month's or perhaps two months bill.

I dislike first utility as they have terribel customer service, but I don't feel like loaning Sainsbury's this money, robbing barstewards that they are.

Is that so? Or are you ranting in full red mist mode?

4 Paying a deposit

When we can ask you to pay a deposit

4.1 We can ask you to pay a deposit whenever that's reasonable (for example, if you haven't been paying your bills on time). We'll give you a reasonable time to pay us, but you have to pay by the date we say.
We won't ask for a deposit if we install a prepayment meter at your property. However, if we install a prepayment meter, we can end this contract (as clause 8.8 describes).

http://www.sainsburysenergy.com/products-and-services/energy/our-energy-tariffs/standard/terms-and-conditions.html#content4

Furthermore, Sainsbury energy is just a white label supplier tariff from British Gas.

British Gas say:

We normally ask for a
security deposit in the
following situations:

•

If you are an existing customer but

have repeatedly failed to pay your
bills within 28 days of request

•

If you are an existing customer and

have broken an agreed payment
arrangement

•

If you are a new customer and do

not give us proof of your identity
and your previous addresses for
the last three years

•

If you do not have a satisfactory

credit status

•

If you have a bill that is unpaid

•

If you are disputing a bill and have

not made payments towards the

undisputed portion

and

If you pay a security deposit

If we need a security deposit you’ll be
asked to pay the following:

•

£125 for gas

•

£90 for electricity

You’ll still need to pay your bills promptly
when you get them, the deposit does
not count towards your bill.

After twelve months we review the
situation. If you have a good record
of payment, we will write to you within
14 days, and repay your deposit

with interest.

http://www.britishgas.co.uk/content/dam/british-gas/about%20us/pdfs/lots_of_ways_to_pay.pdf (page 7)
(my highlighting)

dadsgoneshopping

Footyguy, yes Sainsburys supply for BG, no they do NOT pay interest, I have had this confirmed to me today by two different people whilst on the phone with them for nearly an hour

Bluebirdman_of_Alcathays

dadsgoneshopping wrote: »

Footyguy, yes Sainsburys supply for BG, no they do NOT pay interest, I have had this confirmed to me today by two different people whilst on the phone with them for nearly an hour

The two different people almost certainly don't know the T's and C's inside out. Trust me on that!

Footyguy is correct, the employees were wrong.

Sainsbury's don't "supply for" BG - they are BG. The people you spoke to were BG employees. The rep that comes on here dealing with Sainsbury's issues is a BG employee.