Octopus and my Credit Score

marcuus50

Hi all, I was transferred to Octopus Enery when Avro ceased trading last year. I have since had a notification fro Credit Karma that my score had declined. I logged in to find out why and it is because Octopus Energy have set up a new account and are reporting payment history etc as though it is a credit account.
I have not knowingly consented to this, nor did Avro do this previously. I have never known an energy provider do this and the opening of this account has negatively affected my credit score (with Credit Karma advising I not open any more for 6 months).

I havent signed a credit agreement and therefore cannot understand why a credit account has been added to my report.

Has anyone else had the same issue?

BeerSavesMoney

I’m with Octopus too and it shows up on my report, from past experience I know OVO report to credit reference agencies as well and currently I’m with United Utilities for water that do the same. 

I don’t think a Utility account would show up as a negative when applying for credit unless of course you go into debt.

You’ll probably get a better answer to this in the Credit File & Ratings section of this forum.

MWT

There is nothing unusual in energy suppliers reporting to the credit agencies, you are using energy on credit and paying for it later...

The credit scores you see on these sites are very artificial and do not have any real meaning to lenders who will do their own scores and care more about what is on the credit file, they never see the fake score the sites show to you...

meinnit

It's possible that Octopus use the same credit agency as Credit Karma which is why you're only just seeing an energy account on your credit report. Avro may have used an agency not covered by Credit Karma

Merlin139

Just looked at my report with KC and Octopus are showing. It shows OK for November. Will be interesting to see how this progresses as the DD Octopus have set up will only take money as and when they get round to billing me?

Based on whats happening at the moment I can't see that happening soon!

Summerof26

This is an old post but I am experiencing this too. Were you able to correct this?

I am not sure my score was affected but Octopus is showing as short-term debt from June 1 and for this reason I was recently rejected by Barclays for their Amazon credit card. This is how I found out.

It is truly shocking - I have an impeccable score and never missed payments for years. My setup with Octopus, which they implemented and I also have not knowingly consented to, is that a DD is approx 10 days or so after the bill taking the payment. I have never not paid this as per DD and my account history with them goes back to 2019.

Octopus has created a marking that is not true in any form and it can have real consequences. This is not all right.

bristolleedsfan

https://forums.moneysavingexpert.com/discussion/comment/82100105#Comment_82100105

I was shocked a few years ago having pre-paid for 12 months BT the then line rental saver to see credit report indicating a - balance, was explained to me - balance means in credit.

If you have always paid all required sums of money I would have thought highly unlikely to be classed as short term debt. ask credit reference company.

Taken from a random X post within last 24 hours " to a water company and reply.

"Can you clarify whether this means I'm in credit or debit?"

Your balance:
-£57.35 (In credit)

"the screenshot shows the wording 'in credit' and the minus symbol, which means the account is in credit. Please let us know if you have any other questions"

MWT

https://forums.moneysavingexpert.com/discussion/comment/82100105#Comment_82100105

I am not sure my score was affected but Octopus is showing as short-term
debt from June 1 and for this reason I was recently rejected by
Barclays for their Amazon credit card. This is how I found out.

Did Barclay explicitly state that the short-term Octopus debt was the reason for the rejection or just debt in general?

Many things will appear as debt on your credit history, like the last balance on a credit card for example, but that isn't a negative marker.

Similarly the synthetic credit score generated by the various reference agencies is not what the lenders use to evaluate you, it is the actual markers on your file and the active credit agreements that you hold.

It is truly shocking - I have an impeccable score and never missed
payments for years. My setup with Octopus, which they implemented and I
also have not knowingly consented to, is that a DD is approx 10 days or
so after the bill taking the payment.

If the DD is taking the full amount of the bill then that is a payment method known as monthly variable direct debit.

This is not a default payment method used by Octopus and has to be specifically requested by the customer.

The default is always a monthly direct debit at a rate that should cover your bills over a 12 month period, and most prefer that as it remains at a steady rate rather than varying in line with your actual consumption each month…

There is nothing in general wrong with an energy company reporting to the credit reference agencies and as long as you do not miss payments then there will be no negative markers, merely being on your file is not in itself negative…

Summerof26

Barclay did not say, even though I called. Customer service said they can't tell. They asked me only whether my credit report was up-to-date.

There is nothing else in my history/report other than that.

Sometime between May and July 2023 my payment was changed by them. It used to be bank transfer, then became DD and the amount of it changes by usage. I cannot recall that I consented but remember feeling surprised about the DD set up.

Summerof26

https://forums.moneysavingexpert.com/discussion/comment/82100161#Comment_82100161

I tried to dispute but for balance they don't accept a dispute, but that I need to contact the company

MWT

https://forums.moneysavingexpert.com/discussion/comment/82100225#Comment_82100225

I very much doubt that Octopus correctly reporting that you have an account with them had any more impact than any other similarly reported account.

Having a balance and paying on time is generally a good thing from a credit perspective as it shows you can manage credit responsibly.

Sometime between May and July 2023 my payment was changed by them. It
used to be bank transfer, then became DD and the amount of it changes by
usage. I cannot recall that I consented but remember feeling surprised
about the DD set up.

This isn't something that Octopus would or could do without your consent, was this part of a move from another supplier or were you already with Octopus at the time?

Payment on receipt of bill which is what you are describing with payment by bank transfer is often a more expensive way to pay, was this perhaps part of a tariff change?