Martin Lewis has issued an urgent plea to customers of energy firms like E.on, OVO, Octopus, British Gas, SSE, and EDF to spring into action ‘today’.
The renowned money-saving guru highlighted on Good Morning Britain that these companies are hoarding over £3 billion of customers’ funds.
Delving into the specifics, he noted that direct debit payments commonly result in a substantial credit accumulation. Mr Lewis cautioned viewers about withdrawing this excess too hastily without considering the seasonal energy consumption cycle, but offered a general guideline.
Martin told GMB host Susanna Reid: “This is all about the energy direct debit cycle. What happens, you see, your monthly direct debit is paid at an even amount across the year, so that in the high use months you’re paying less than you’re actually using and in the low months months you’re paying more than you’re using, so it all spreads out.
“So if we see someone with a zero balance in January, you’ll see you either start to build up the debt or use up your credit going down and down and down until roughly this point.
“Now this is the lowest point in the year, so the point when you should either be in the most debt or have the least amount of energy credit after this point, because we go into the summer and you’re using less and you’re paying the same amount, you start to either reduce your debt and build up credit.”
He explained: “Your pattern would be you build up credit throughout the year, Max is in November, then you use it all up. And if you were to start in November, then you would build up debt throughout the year, you would be at the bottom in May and build it all up.”
Mr Lewis highlighted that the crucial point is that today marks the ‘bottom point’ when customers either have the most debt or the least credit. This allows customers to ascertain – assuming they’ve been with the provider for approximately 12 months, if they’re excessively in credit.
He stated: “The bottom point, the point where you either have the most debt or the minimum credit, is today, which means if you go and check you’re in credit and you have substantial credit on your. Monthly direct debit energy account right now, you have too much and you should be asking for it back.
“And what should you do if that’s the case? Here’s my rough rule of thumb because there are vagaries here, and the whole point of monthly direct debit is to, it’s a budgeting tool to spread out your usage. It’s never gonna be perfect.
“My rule of thumb, and I can’t do it by an amount because it all depends on the proportions of how much you pay.
“If you have more than a month, a month and a half worth of direct debit in credit right now, so let’s say your direct debit’s £200 pounds and you’re £500 pounds in credit, I’d be asking for £200 pounds of that back.”
