Ovo Energy is the first national energy supplier to offer monthly interest rewards to customers who build up a credit balance on their accounts from 1st July 2010.
Ovo Energy, an independent energy supplier that aims to offer cheaper and greener energy will credit customers with a reward equivalent to three per cent interest per annum. The reward will be credited to customers accounts when a monthly or quarterly statement is due.
Whilst not connected to the Bank of England’s base rate of interest, Ovo’s reward rate will reflect market conditions. Ovo’s reward rate is set until the end of 2010 and will be reviewed every six months thereafter.
The average customer, who uses approximately £1,000 of energy per year, could receive a reward of up to £30. Savings can also be made when you switch energy supplier, and Ovo Energy are consistently cheaper than standard, direct debit tariffs from the Big Six energy providers.
Commenting on the way in which the rewards will be made, Stephen Fitzpatrick, managing director and founder of Ovo Energy, said: “To make sure it’s as fair and simple as possible, we’re offering monthly interest rewards rather than making a one-off calculation on an end of year balance, when customers are less likely to be in credit.”
Ovo, whilst one of the smallest energy suppliers, is likely to cause a stir in the marketplace, particularly as one of the biggest sources of complaint within the industry is the setting of direct debit levels and companies holding customers’ credit balances.
According to moneysupermarket.com, for example, their research has found that last year on average five million households were in credit to their gas supplier – with each bill payer owed on average £89; leaving UK consumers a staggering £454 million out of pocket collectively. With the OVO Energy deal however, those customers could be earning back over £13 million a year in interest.
This initiative by Ovo Energy is winning approval from consumer pressure groups. Maria Wardrobe, Director of Communications for National Energy Action (NEA), the national fuel poverty charity, said:
“In encouraging customers to pay monthly this initiative is a welcome move. At NEA we know that budgeting for energy bills helps protect customers from falling into debt which is essential in the current economic climate.”
You can visit Ovo Energy to learn more about this market leading initiative.