Variable Direct Debits

alderpoint

Hengus wrote: »

There is a confusion here as, semantically, there is no such thing as a variable direct debit.

Well that is what FU call it here.

What you have signed is a 'continuous payment authority' which allows a supplier to collect variable amounts through the Direct Debit Scheme.

This is the same whether the supplier collects fixed or variable amounts - they must tell you the amount they are going to collect 14 days (IIRC) in advance.

When a Fixed Direct Debit is used ...

Oh. You seem okay with the term Fixed DD, but not with Variable DD.

At the end of the day, this is very much a matter of personal choice.

100% agreed. Just many people don't realise that there is a choice.

Coedy

Bark01 wrote: »

EDF offer 'Whole Amount' direct debit for either monthly or quarterly billing. You pay the amount billed not an amount that tries to average out payments over 12 months.

Its exactly the same price as all their other DD tariffs, so sound like what you are after.

Not sure if you can sign up to it via comparison sites. But once signed up to EDF you can switch to it online or via EDF customer service at no detriment.

That's great thanks! EDF Arent the cheapest overall but they are a lot better than BG, and better feedback than FU.:beer: (Plus my parents are with EDF at the moment)

I'll give them a call to query the logistics of it but then I'll probably end up switching on the last day of the Big Energy Switch (to see if they come up with a better tariff to try and compete a bit with the big switch).

Thanks again! :money:

MABLE

After a bad experience with EE I vowed never to pay by monthly direct debit again. I pay E.on by variable dd on a qtly basis and suites me fine. Also if I time it right I can pay the account by using my cash back credit card and this stops the dd being activated for that period.

Montypython

Shrimply wrote: »

While that may be the case. I've just been told by the E.On rep on another thread that the reason for the charge is due the extra cost in managing the account when you aren't paying a fixed monthly direct debit. Depending on how you interpret that I guess it could be the same or a different argument.

And I get the point that for people paying quarterly there is more risk in building up large debts, but surely people that are clearing their entire debt each month are actually lower risk, especially when paying by direct debit.

If I switch now for instance to E.On they will set my direct debt to £26 a month. By the end of winter I will be in debt with them.

Now this is all just argument for arguments sake really, because they aren't going to change it just because I'm moaning about it. However, I'm not entirely sure why variable direct debts aren't more widely offered.

So for just now, I'm going to hold off and hope that First:Utility bring out a more competitive tariff before the end of the collective switch. I may end up switching to E.On as it will save me money and just have to put up with the fixed direct debit payments.

Sorry for bumping this thread, but when I queried why Eon charge £ 70+ if you I paid by Variable Direct Debit I was told over the phone by a Supervisor that the extra money was used to cover costs of other customers who defaulted on their payments. This is not acceptable at all.

Cardew

Montypython wrote: »

Sorry for bumping this thread, but when I queried why Eon charge £ 70+ if you I paid by Variable Direct Debit I was told over the phone by a Supervisor that the extra money was used to cover costs of other customers who defaulted on their payments. This is not acceptable at all.

Either you misunderstood the Supervisor, or it was just after their Xmas party;)

All companies use a variable direct debit to(attempt) to match monthly payments to the customer's annual bill. e.g if a customer is predicted to use £1,200pa ideally the monthly DD would be set at £100.

Like any company - not just gas/electricity - they incur losses because people fail to pay their bills and this loss is borne by all other customers who pay extra.

It might well be that Eon have estimated that those defaulting on payment cost on average each customer £70 a year on their bill(no idea if that is correct) but that will not be a factor of paying by DD, all methods of payment will be affected.

It is no different to shops losing money from shoplifting etc, it is the customer who pays in the end.

System

Montypython wrote: »

Sorry for bumping this thread, but when I queried why Eon charge £ 70+ if you I paid by Variable Direct Debit I was told over the phone by a Supervisor that the extra money was used to cover costs of other customers who defaulted on their payments. This is not acceptable at all.

It's an admin charge - take it or leave it I'm afraid. Clearly, E.oN is trying to steer its customers away from this type of paying arrangement. I would look for another supplier if the policy causes you any concern. Personally, I am happy to pay a monthly DD as I know that at the end of day I will only pay for the energy that I consume.

Former_E.ON_Company_Representative:_Malc

Montypython wrote: »

Sorry for bumping this thread, but when I queried why Eon charge £ 70+ if you I paid by Variable Direct Debit I was told over the phone by a Supervisor that the extra money was used to cover costs of other customers who defaulted on their payments. This is not acceptable at all.

Hello Montypython and sorry you were given such poor information about our Variable Direct Debits.

Mainly, it costs us less to manage accounts paid through a Monthly Direct Debit than other payment methods including a Variable Direct Debit. Under industry rules, we're not able to offer discounts based on payments and any reductions must be consistent with the savings we make as a company. As it costs us around £35 per fuel less to look after a Monthly Direct Debit, we're able to pass this on to customers through lower daily standing charges.

Hope this explains Montypython and sorry you were told wrongly when you queried this.

Malc