Can I Pay More?

Dird

Assuming an energy company quotes me £78/month, is it possible to ask them to charge more than that amount? e.g. £300-400/month with some excuse of wanting to remain in credit?

That would provide 3% interest on the credit per month...on top of £9-12/month utilities cashback :beer:

[Deleted User]

Ovo have all the answers in their Terms and Conditions. I presume that s who you are referring to.

Dird

150% limit and maybe restricted to who can use it =/

Neil_Jones

Dird wrote: »

Assuming an energy company quotes me £78/month, is it possible to ask them to charge more than that amount? e.g. £300-400/month with some excuse of wanting to remain in credit?

That would provide 3% interest on the credit per month...on top of £9-12/month utilities cashback :beer:

This sounds like OVO.

In theory, yes, but if you do it through the website it would be capped at 150%. When I was with OVO I had the same idea, and jacked it up as high as it would go after each bill. Ultimately ended up at about £115 a month.

Also remember it's 3% OVO interest reward a YEAR, not 3% a month. Read the terms & conditions (my emphasis):

7.2. The OVO Interest Reward is currently calculated monthly as 3% per year using the amount of any credit that will be left in your account after you’ve paid your bill, and the number of days you are in credit in the relevant month.

7.6. Your OVO Interest Reward is capped at 12 times the amount of your current direct debit amount.

warwicktiger

Of course, you can also submit your own meter readings!

Cardew

Over the years there has been criticism - often unjustified IMO - that companies deliberately attempt to build up customer's credit balances.


Having taken measures to address this perceived problem by paying interest on credit balances above a certain amount, we now have people scheming to take advantage.


If the companies had adopted a similar approach they could be criminally convicted of conspiracy to defraud, let alone any sanctions by the Regulator.

naedanger

Malcnascar wrote: »

Excuse my ignorance here, but do these companies have or need a deposit takers licence as they appear to be acting like savings institutions.

I strongly suspect they don't need a deposit takers licence. Many companies allow customers to pay for goods or services in advance of delivery.

Are the credit balances protected?

No.
http://www.moneysavingexpert.com/team-blog/2013/05/13/paying-upfront-what-happens-when-an-energy-firm-goes-bust/

While 3% is a generous rate for customers it is probably less than the rate the supplier is paying on any of its borrowings. (Not that that justifies any dishonesty.)

Also the actual monetary amounts are very small - £15 a year if the account was on average in credit by £500 over the whole year. And that balance is bearing a credit risk that a bank would almost certainly charge more than 3% a year to cover. So this hardly seems a significant factor when shopping around. (Although it should meet its purpose - i.e. to help address the complaint that suppliers are setting the monthly payments at too high a level to help their own cashflow.)

System

Ovo's policy has been challenged by other energy suppliers and the competition lost.

https://www.ovoenergy.com/blog/ovo-news/the-ovo-3--interest-reward.html

Any 'credit balance' has the same protection as in the case with all energy suppliers.