Can I safely lower my energy Direct Debit?

DocQuincy

I'm not sure if this is a daft question or not but I have a DD with Octopus and usually end up being in credit. However, I have a few months of cashflow issues. If I lower the amount and end up being £100–£200 in debit in 3–4 months time will it affect my credit rating? Will Octopus do anything such as increase the DD?

FlorayG

Octopus will do an automatic check every 6 (?) months and send you an updated DD. Obviously if you are in a lot of debit this will be a lot of increase. I don't think your credit score has any connection; lots of people go from credit to debit regularly in their utility bills

YBR

I agree, Octopus will let you change your DD on the website and withdraw credit from the account up to a limit. I found them even more flexible when I called them. They do periodically check and will bring your DD back up (not without warning).

I found this winter that their DD amount is a little higher than I'd set but not absurd; seems to be based on their usage estimate which is around 5% above mine based on history.

Wider picture: If you're robbing Peter to pay Paul, will your income recover sufficiently afterwards to pay off the debt, and can you re-budget to pay back the debt and then build up some savings?

DullGreyGuy

DocQuincy said:

I'm not sure if this is a daft question or not but I have a DD with Octopus and usually end up being in credit. However, I have a few months of cashflow issues. If I lower the amount and end up being £100–£200 in debit in 3–4 months time will it affect my credit rating? Will Octopus do anything such as increase the DD?

What is your current balance?
What is your normal payments?
What payment are you proposing?

The idea of flat DD payments is you over pay in summer building up a credit balance and then underpay in winter which erodes the credit you therefore have the benefit of a flat monthly payment rather than variability as the seasons impact your usage. 

Ending in a negative balance at the end of summer would almost certainly result in them adjusting the DD upwards notably as you have failed to build up the credit to see you through winter

DocQuincy

Thanks everyone.

It won't actually let me change it too low in the app but I have lowered it a little. I have found in the past they do overegg it a bit presumably to increase the amount of cash at any given time.

Yes, I wll be able to get back on top of it. I am going through a one-off problem at the moment that is affecting my income for six months.