Direct Debit explained
Direct Debits help you pay for gas and electricity over a period of time, spreading payments regularly. We want to help you make sure you pay just the right amount for your energy so Direct Debits are a great way to manage your costs, because they're convenient and help you budget.
Ideally, we work out what your Direct Debit amount should be by looking at how much energy you actually use. But if you're a new customer and you don't have a bill from a previous supplier to hand, we can ask you for some information that will help us set up the payments to start with - things like how big your house is, how many people live there, whether you have gas central heating or you use electricity to heat your home.
- We'll try to work out how much energy you're likely to use over the next 12 months (remember, in the winter you'll probably use more heating your home than you would in the summer) and what that will cost at today's prices.
- We divide that estimate by 12 - it doesn't matter when in the year you join us, we always calculate this over the next 12 months - and that's what your monthly Direct Debit amount will be to start with.
Then, as time goes by, we can look at exactly how much energy you've used and forecast what your ongoing costs will be. We'll do this review about once every 6 months to make sure your payments are at the right level. You'll also get an annual statement from us, which gives you an update on how much energy you've used over the last 12 months and how much we think you should be paying in the coming months.
This is why up to date meter readings are really important. They show us exactly how much gas or electricity you've used and how much you should pay, on average, by Direct Debit each month, for the energy we've supplied and what you're likely to use in the future.
Here are some handy video guides to how our monthly Direct Debit works. It is designed to answer any questions you may have about your chosen payment method.
To help us work out your monthly payments we’ll ask you for information about your energy usage over the past 12 months. You can find this information on your old bills. If you don’t have this information to hand, we’ll ask you some questions about your home and usage patterns. Once we’ve made an estimate we’ll average out the payments over 12 months and once you're happy to use Direct Debit we'll get in contact with your bank.
At npower, we review your account both annually and roughly half way through your billing year. We usually request a meter reading at these times because having the most up-to-date information helps us to provide accurate bills, which makes it easier for you to stay on top of your energy costs. You can provide meter reads by going online or using our npower app. This will give us a better estimate of your usage.
At your annual review we estimate your expected usage for the year ahead. Depending on your actual usage and any changes in energy prices, your account may end up in credit or debit. If you’re in credit by £60 or more on both fuels, and this figure is based on an actual reading of your meter during your annual re-assessment, we will automatically give it back to you. If you are in debit you have a few options - such as spreading the debit across your monthly payments in future.
We try to spread your payments evenly across the year, even though you may use more energy in the winter months. Typically, twice a year, we'll take a look at your account to see how much you're paying, how much energy you're using, and check the cost of the tariff you're on. If you've built up a credit then we'll factor it in to your future payments when we look at your account. But if your payment has still gone up after we've applied the credit it's because we think you'll need to pay more each month to cover the estimated cost of energy in the coming months.
We try to average out your monthly payments over a 12 month period. But some things can affect those payments and if they do we'll adjust your Direct Debit accordingly. For example, you may be using more or less energy than expected, your tariff period may have ended or our prices may have changed. We can see exactly how much energy you're using and provide more accurate bills once you’ve sent us a meter reading.
Hopefully this information has helped to explain how monthly Direct Debits work. If you have any further questions, please look in our FAQ section. Or if you'd prefer to talk to us, you can contact our call centre.
Set up a Direct Debit
There's a reason why so many of our customers choose to pay for their energy by Direct Debit, it's because it's simple, secure and rewarding.
Our Direct Debit Guarantee for peace of mind
All Direct Debit payments are backed by the Direct Debit Guarantee, which means you can pay with complete confidence, knowing you're in safe hands. This Guarantee is offered by all banks and building societies that accept instructions to pay Direct Debits. Under the Direct Debit Guarantee, if the amount or date you pay changes, we'll let you know at least 10 working days before we take the payment from your account. What's more, if npower, your bank or building society makes a mistake with your payment, you're guaranteed a full and immediate refund.
Terms and Conditions
Meter read reminders: We’ll use the reading(s) you supply to produce your next bill whenever it is possible to do so. There may be some circumstances when it is not possible to use your meter readings and in this case we will estimate your consumption. Our agents will still require access to your meter to take readings and for safety checks. The meter reads you supply will be in addition to our own meter reads and will be used to provide the most up-to-date view on your statement.
Under the Direct Debit Guarantee, if the amount you pay or the payment date changes, we will let you know 10 working days before we debit your account, or on another agreed date. If npower, your bank or building society makes a mistake with your payment, you're also guaranteed a full and immediate refund from your branch of the amount paid. This information has been sourced from BACS.
Automatic refund: Given on credit balances at time of annual review based on actual reading (which may be a customer's own reading supplied to us) and where the credit is over £60. If you take both fuels from npower, we'll use any credit on one fuel account to clear a debt on the other fuel before any refund will be made. Credits of less than £60 will be refunded on request but this could affect future monthly direct debit amounts. If your credit is less than the automatic refund amount, it will be used to offset ongoing payments.