Householders are being warned that giving up direct debits could lead to energy bills rising by 7% a year on average.
The warning has come from financial guru Martin Lewis as customers face eye-watering £3,300 bills on average from October. Many people are tempted to stop paying their bills by direct debit to help with budgeting and avoid unexpectedly large energy bills going out. Choosing to pay when you get a bill may look safer as a result.
But speaking on a Facebook Live broadcast, the Money Saving Expert founder said doing this means you pay more for your energy overall. And the problem will be worsened once energy bills rise again in October.
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Martin Lewis said: "To have a bill rather than direct debit you will pay 7% more. That doesn't sound too much, does it? But once you get into the October price cap you are talking a couple of hundred quid more a year to have those bills. Direct debits affect your cash flow, but it is cheaper and you pay less overall, so it is a difficult decision."
He also urged customers not to try to remove their own meters to save money, following a trend on social media. He said: "Do not try to remove your own meter. It's dangerous, to start with."
He added that some people on social media believe you pay for having a meter - so no meter, no bill. Martin said this was "crackers".
Earlier this month energy regulator Ofgem told a number of energy suppliers to take "immediate and urgent action" after a review found problems with how they charged customers, reports The Mirror. Out of 17 large suppliers in the market most had minor issues, but five were found to have "moderate or severe" weaknesses.
Ofgem is asking all energy firms that hiked 500,000 customers' direct debits by more than 100% to review these bills. Ofgem added: "Where appropriate, Ofgem also expects suppliers to adjust any miscalculations, including making repayments if needed, and consider whether a goodwill payment is warranted."
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