This research explores whether low-income consumers are interested in greater flexibility in how they pay for essential services, particularly electricity bills.
Whilst flexibility is not the main solution to affordability in energy, or to wider energy issues, it is clear that it could help people with their bills. This is because it would give people the option to pay in smaller amounts or change payment dates. Offering flexibility is a step towards ensuring that low-income households can manage their finances without added financial strain.
Six focus groups were conducted with individuals on low incomes, including those who pay for energy via prepayment meters, receipt of bills (standard credit), or Direct Debit.
Key Findings
- The findings show that being able to pay flexibly and control over payments are essential for low-income consumers when considering new payment methods.
- People on low incomes recognise that variable recurring payments (VRPs) can be good for some people, such as people who don’t receive their incomes monthly. But while VRPs offer a new opportunity, the ability to offer flexibility over how they pay already exists.
- Trust in energy suppliers was also a crucial factor that influenced how people choose to pay their bills, especially energy bills. This lack of trust could impact on how any payment method, such as VRP, will be received. Suppliers have to work hard to sell the benefits of any new payment method to consumers.
- Authors: Sara Davies and Sharon Collard
- Funded by: Barrow Cadbury Trust
- Published by: University of Bristol / Fair By Design
- Publication date: October 2024