British Gas pays £1.73m for botched prepayment switch

British Gas has paid £1.73m in compensation for failing to tell prepayment customers about a change of provider and minimum top-up spend.

The energy regulator said British Gas, owned by Centrica, failed to notify about 270,000 prepayment customers that their provider changed from Paypoint to Payzone on 1 January. The minimum payment also increased from £1 to £5.

This meant some customers may have wasted journeys to top up at shops that no longer offered the service and in some cases may have gone without power, Ofgem said. British Gas eventually got in touch with these customers, many of whom were vulnerable, in late January.

British Gas told most of its customers about the changes in December 2019, which was too late, Ofgem said. The communication did not give a phone number and its enquiry line was not working on the day of the changeover.

Ofgem said British gas had paid £1.48m to customers affected by its failings and an extra £250,000 into the regulator's energy redress fund.

Philippa Pickford, Ofgem's director of retail, said: “When such a fundamental change is being made, such as where meters can be topped up, energy suppliers need to communicate with their customers in plenty of time. British Gas should have informed all of their prepayment customers, many whom are in vulnerable situations, of the change to how to top-up their meters during the winter period.

“Some customers were unaware of the change before it happened and may have struggled to contact British Gas as they opted not to open their general enquiries line on the go live date."