Paying For Your Energy by Direct Debit: Is it the best payment method?

Direct Debit

What’s in this guide?


Usually, paying by direct debit is not only the easiest way to pay for your energy, but it can often be the cheapest option too.

Are you considering paying by direct debit? To find out more first, take a look at this guide.

It will tell you everything you need to know about paying by direct debit, including what exactly it is and how it works.

What is direct debit?

Direct debit allows you to make regular payments, usually every month, to a company in exchange for services or things like your energy.

For instance, you may already pay for your mobile phone by direct debit every month. Your bank statement might say the name of your mobile phone provider, with the price next to it, for instance, £10.00.

You can then rest assured that you don’t need to remember to pay your mobile phone bill, as it will come out of your chosen account automatically.

How does it work?

So now that you know what a direct debit is, how does it work?

First, you set up a regular payment between your chosen bank account and your energy supplier.

Second, this gives your energy supplier permission to take that payment from your account on a specific date from now on.

Third, your bank is then sent a confirmation of this information and will authorise the payment.

This means that you won’t need to remember to pay your energy company, which avoids problems such as your power being cut off as it’s automatic.

Interested in the advantages of direct debit? Let’s take a look.

What are the advantages?

The best advantage when it comes to paying by direct debit is that you don’t have to spend a lot of time and energy worrying about paying for your power.

As your payment will be taken out automatically, you don’t need to forget about paying your bills.

Plus, you don’t have to have a concern about your energy bill arriving late in the post.

This is because your energy supplier will take your payment out on the same date every month regardless.

You don’t have to be worried about anything going wrong with your payments because as you are a consumer, you are protected under the Direct Debit Guarantee.

Another benefit is that if your energy company accidentally overcharges you for your energy, you can request an immediate refund from your bank.

Will I be notified if prices increase beforehand?

Did you know that your energy supplier has to notify you of price changes ten days in advance?

This also applies if your energy supplier intends to change the date your direct debit is going to go out.

Most of the time your electricity or gas company will tell you when they are taking your payment even if they aren’t changing the prices.

How do I stop a direct debit?

If you need to stop your direct debit, it’s as simple as getting in touch with your bank.

You can either do this over the phone or by email.

Make sure you keep a record of this cancellation, in case you need it in the future.

What if I don’t have enough to pay?

Typically, if you don’t have enough to pay then your energy supplier will usually still try and take the payment a few days later, which gives you a bit more extra time to get your finances in order.

However, if you continue to not pay your energy bill, then you’ll usually have a penalty fee.

They might end up putting you on a prepayment meter to ensure that you don’t miss a payment in the future.

Unfortunately, prepayment meters are usually far more expensive than a standard credit meter and can cost you much more in the long run.

So you should try and avoid it whenever possible.


Are you interested in switching your energy supplier?

Did you know that you could be saving up to £500 on your energy bills every year?

Take a look at the EnergySeek guides to find out more about your energy, or see reviews of the top 7 energy switching sites to compare gas & electricity.