Why has my monthly direct debit increased? — Bulb Community

Why has my monthly direct debit increased?

DenDen
edited November 2018 in Help & Support
Since first joining Bulb months ago my direct debit was agreed at £81.69 and that's whats been taken on direct debit but I've just noticed this morning that on my account the direct debit amount is now showing as £96. Surely you can't just increase my direct debit payment without informing me first. What's more annoying is that I'm over £200 in credit anyway. I need an explanation.

Comments

  • Hey @Den

    This Community post will help explain why we suggest members increase their payments.

    Any member that has a payment review will receive an email at least a week before any changes are made. We sent yours on the 23rd of October. If you can't find this is in your inbox or spam email, please let me know so I can investigte where it's got to.

    If you have any more questions, please let me know.
  • I can confirm that I've not received an email telling me that my payments are to increase to £96. If my payments are being increased and therefore paying more money to you what's happening with credit I have of over £200. To my way of thinking that should surely be used up first before increasing my payments and if not then you're sitting there with over £200 of my money doing nothing except making interest for you. I may as well have that money in my bank making interest.
  • @Den

    Purely as another customer.

    This a query that crops up on a daily bais on this forum, you can check these out by carrying out search?

    Does the information on your "Payments & statements page" say something like "it is recomended you increase your payments to £96", but the actual Monthly payment is still showing Monthly Payments of £81.69.

    If the above applies and you have built up a credit of £200 and this is sufficient to pay one month enrgy in advance then you can leave your payment at £81.69.



  • Hmm. @Den I'm going to investigate a bit further. I'm going to send you a dm to chat about the details.

    Yes, this increase despite the credit is a bit confusing.

    This is the one that can be confusing.

    At Bulb your payments stay the same throughout the year.

    This means you build up credit over the summer and use it during the winter when you’re using more energy.

    Just before winter, your account should have enough credit to see you through the colder months. And your payments should be high enough to ensure you start building up credit again in the spring.

    We'll suggest you increase your payments if the credit in your account is not quite enough to see you through the winter. This community post goes into a bit more detail.

  • Hello,

    Today I just received an email from Bulb that says that my direct debit will be increased next month despite the fact that I have over £200 in credit.

    Can you please let me know if you can cancel that increase because it doesn't make any sense to me when I 've got an amount that can cover for sure my bills.

    Thanks,
    Georgios
  • You should be able to go to your account and then:
    `My account and tariff info`
    And change the payment ,
    bearing in mind you may need to top as required if you fall below the monthly advance payment level.
  • @scudo

    I believe the system is flawed, Bulb shouldn't be asking customers to increase the DD if they have large credit in their accounts.
  • For the first time I received an email saying they were putting mine up on a given date (I changed it back down) I am positive previous emails were a suggestion to raise it, I am over the next months desired credit level. This if I am correct is a recent change in wording.
  • I'm pleased I'm not the only one confused over this issue. Doesn't make sense to me. My payments were set at £81.69 but the £96 just appeared. It didn't ask or suggest that I increase to £96. The stupid part about this is that I can go back into my account and change it back down again if I want so I can't see the reasoning behind this. This is all unnecessarily confusing. Bulb needs to make this more transparent.
  • @Den We need to make sure that our members will be paying the right amount. It might seem to a lot of our members that they are in a large amount of credit, but we are about to increase our rates on the 11th of November from the price rise we announced 2 months ago.

    This alongside the higher winter bills means our system thinks there will be many members that will be in debt in a years time.
  • This alongside the higher winter bills means our system thinks there will be many members that will be in debt in a years time.

    But does that matter? Say my annual usage comes to £1200. I might pay £100 per month meaning whether I have a period of credit or a period of debt makes no difference, it'll come out to zero at the end of the year.

    Clearly the customer would rather go into debt over winter and then pay it off over the summer, keeping their money in their account and earning some interest. The supplier on the other hand, would prefer the customer to go into credit over the summer and then use it up over the winter, keeping the funds in the supplier's account instead.

    It wouldn't bother me at all if my account went into debt, because I keep on top of it and know that my monthly payments are correct for it to all work out in the end. A less fastidious person may well be better off building up a credit to prevent potential bill shock when they eventually get around to submitting a meter reading and paying attention to their bills. So it makes sense that accounts are operated with a positive bias.
  • But does that matter? Say my annual usage comes to £1200. I might pay £100 per month meaning whether I have a period of credit or a period of debt makes no difference, it'll come out to zero at the end of the year.


    Probably not in theory but customers being in debt and with Bulb paying in advance for their fuel it sort of balances out the debt Bulb has to take on. Maybe Bulb can confirm but if Bulb customers paid in arrears I suspect either they would go bust or prices would have to rise accordingly.
  • Thanks for your comments.

    Here’s an explanation of the payment review process in a bit more detail. If you have suggestions about how we can make things clearer, please let us know.

    Why do we review your monthly payments?

    Keeping your payments at the right level keeps everyone’s energy cost lower, and it stops members getting unexpected high bills later on.

    At Bulb, we’re committed to providing energy that’s both green and affordable.

    We buy our energy in advance. And as a result, we’re able to offer a cheaper tariff for all our members. But in order to provide that cheaper tariff, we need our members to keep one month’s credit in their account. Otherwise, we’d have to increase your prices relative to what they are now to help us build a cash reserve for winter months.

    We also try and avoid ‘bill shock’ for our members. This happens when you don’t submit a meter reading for a while and your actual readings, which measure your actual usage, are higher than your estimates. Suddenly you’re faced with a large bill you weren’t expecting.

    By sending our members payment review emails, we aim to keep your balance healthy throughout the year. The key thing we calculate your payments for is to make sure you have enough credit in your account at the start of next winter, in 12 months time.

    Who is sent a payment review email?

    People who will not have enough credit to make it through Winter 2019

    This includes:
    • Members whose average usage is £5 more than their monthly payments
    • Members who don’t have at least two month’s winter buffer in their account
    • Members who do have 2 months winter buffer in their account but their current monthly payment is still too low
    This last point can be a little confusing so I’ll expand:

    At Bulb, your payments stay the same throughout the year.

    Even if your account has a healthy enough credit now to avoid building up debt this winter, your payments should be high enough to build credit up again for the next winter.

    For example, if your monthly payments are £80 but your average usage is £120 per month, by this time next year your account will be in debt despite having a credit of £200 now.

    How do we let our members know about a payment review?

    Up until now, we’ve sent two emails.

    1) "We think you should increase your payments"

    First, we’ll send you an email to say that your average monthly usage is greater than your monthly payments. We don’t make any changes to your direct debit at this point. Instead, we give you the option to increase your payments yourself.

    2) "We need to increase your payments"

    If you decide not to make changes to your monthly payments, we’ll send you an email to say your direct debit will be increasing.

    This email will say
    • How much we are increasing your payments by
    • When your payments are increasing
    • How we have calculated your payment increase
    However, members have told us that sending two emails is confusing. So we’re now just sending one.

    How can a member stop their monthly payment increasing?

    If you don’t want to increase your payments to the suggested amount, you don’t have to.

    We give you plenty of notice so you can do one of two things:
    • Email us to say you’d rather keep things as they are
    • Log in to your Bulb account and change your direct debit
    If you do either of these things, we won’t send another payment review for at least 3 months.

    How can you have your credit refunded?

    If you’d prefer to have the credit in your Bulb account transferred to your bank account, then you can drop us a line and we’ll send you a refund.

    Before we do, we’ll need some up to date meter readings. If you need it, we have advice on how to read your meter.

    But, if you chose to take the credit from your account, we’d suggest also increasing your direct debit payments.
  • @Eleanor at Bulb

    Just a couple of points:

    For accurate bills it is ideal if customers supply their monthly meter readings at the appropriate time. I have seen some posts on the forum where customers have complained about a hike in prices only for it to turn out Bulb had to estimate the costs because a meter reading hadn't been submitted for quite a time. We are advised by Bulb each month to submit meter reading for accurate bills, where a meter reading is long overdue do you send out other more urgent email reminders telling the customer they really need to submit a meter reading?

    What happens in a situation where an account is in debit and which is likely to increase each month but where the customer refuses to increase their payment to the amount suggested by Bulb?


  • Having received this email myself and build upping my monthly DD by almost half again, I must say I felt pretty annoyed and cheated.

    From reading the above the point I most take from this that I think should definitely be made aware to potential customers (although I very much doubt it will) is that Bulb REQUIRE customers to have a months worth of credit in their account, so that Bulb then have enough cash to buy their energy up front!? So you are using our money to fund part of your business model, which I think is pretty bad...
  • It is up to the individual to chose what business model suits them.
    You may pay in advance with Bulb but that money is used to pay your usage, so is not lost.
    The big 6 overcharge by £200-300 per year which is money you never get back.
    So over a period you pay a lot less with Bulb than with the big 6.

    Over say a 2 year period with Bulb you will have built up some credit.
    With the big 6 you have lost up to £600.
  • Allanr said:

    @Eleanor at Bulb

    Do you send out other more urgent email reminders telling the customer they really need to submit a meter reading?

    In short, we do.

    Ofgem regulations require all energy suppliers to notify their members when a direct debit will be leaving their account.

    We use this opportunity to send a monthly meter reading reminder.

    This email says:

    “Hi @AllanR

    Just so you know, your monthly payment of £XX will come out of your bank account in three days.

    If you’d like us to calculate your monthly statement using your actual usage, send us a meter reading today or tomorrow. No worries if you can’t, we’ll use an estimated reading instead”


    If a member hasn’t submitted a meter reading in four months, we’ll give you a nudge. This email is a little more urgent:

    "Hi @Allanr

    We haven’t had a meter reading from you in over four months. We need you to send a meter reading every three months to make sure you're not paying us too much or too little.

    Please could you send us a meter reading now?"


    As each month that passes and no meter reading is given, we’ll update the email:

    “We haven’t had a meter reading from you in over four/five/six...months.”

    It's important to have meter readings so we can send accurate bills. And it prevents members getting 'bill shock' if their estimates are lower than their actual readings.

    Just think, when smart meters arrive, we'll have to send a lot less emails. Phew.
    Allanr said:

    @Eleanor at Bulb

    What happens in a situation where an account is in debit and which is likely to increase each month but where the customer refuses to increase their payment to the amount suggested by Bulb?


    If an account is in debit, we strongly recommend you increase your payments. But we won’t force you.

    It’s important that we keep our members up-to-date with their account balance. So, as well as sending monthly statements, members can view their balance in their Bulb Account at any time.

    To make things even simpler, the Bulb Account has a suggested payment amount and an option to change the monthly payment schedule.

    This way, members can keep their account in ship shape themselves.

    But we understand that circumstances differ for everyone.

    If a member’s account is in debit, we want to have a better understanding of your situation and how we can work together to get your account back on track. This is why our team of friendly energy specialists are on hand help you out, and why the payment review email directs members to independent and impartial advice.

    The ‘payment review’ email is sent every three months. If an account is already in debit or, by this time next year, the payments won’t cover the usage, a payment change is advised.

    But we won’t send a payment review if a member has:
    • made a change to their direct debit in the past 3 months
    • been supplied by Bulb for less than 3 months
    • requested we stop reviewing their payments
      Shelvock said:

      Having received this email myself and build upping my monthly DD by almost half again, I must say I felt pretty annoyed and cheated.

      From reading the above the point I most take from this that I think should definitely be made aware to potential customers (although I very much doubt it will) is that Bulb REQUIRE customers to have a months worth of credit in their account, so that Bulb then have enough cash to buy their energy up front!? So you are using our money to fund part of your business model, which I think is pretty bad...

      We're upfront about asking members to have one month's credit in their account. It allows us to buy energy in advance which is cheaper. We can then pass the savings on to you.

      We communicate this twice when signing up.





      We also let you know that we take advanced payments in your welcome pack and 2 days before your first payment is made.

      If you think there are any ways we can be clearer about this, please let us know.
  • @Eleanor at Bulb

    Thanks for the detailed explanation.

    My query was really to get a better understanding as to why some customers vent their feeling on the forum when they get a DD payment increase email.

    I personally have no issues with the Bulb processes except perhaps for the 2 month buffer requirement which hasn't hasn't affected me to date.

    I'm not sure how much more you can do to advise customers who have concerns about DD increase that they can in effect control their DD via the account dashboard. The option to set your own DD most certainly wasn't an option given by my two previous suppliers who were two of the big six.

    My previous suppliers would up my DD after first giving me advance notice and if I thought it was excessive I had to negotiate with them having supplied supporting calculation evidence as to why I considered my DD to high, they then would reduce it to a figue both them and I agreed on.


  • We're upfront about asking members to have one month's credit in their account. It allows us to buy energy in advance which is cheaper. We can then pass the savings on to you.

    We communicate this twice when signing up.

    We also let you know that we take advanced payments in your welcome pack and 2 days before your first payment is made.

    If you think there are any ways we can be clearer about this, please let us know.

    What I mean is that you don't state that customers are required to have 2 months worth of credit in their account to facilitate Bulb purchasing the energy up front.
  • I appreciate that I can control the amount I pay and I am very grateful for that, as Allanr says not many other providers offer that. I just feel that my payment has been increased unjustly, I don't think I need to be paying anywhere near that much, and don't really understand why you do.
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