Pay utility bills by direct debit to save a packet

If you are struggling to meet the cost of utility bills, you may benefit from reviewing your payment methods to see if there are savings to be made.

Research from moneysupermarket.com has shown that householders on a standard energy tariff and paying quarterly by cash or cheque, could save an average of £170 per household each year by switching to an online deal and paying by monthly direct debit (MDD). This adds up to a total potential saving of £2.3 billion per year.

Customers on Scottish Power’s standard deal would benefit most from the switch. The research shows that they could save £300 a year on average by switching to the supplier’s Online Energy Saver 5 deal. But for real savings, customers should be considering switching energy providers to get the very best deal.

At the moment, the Websaver 3 tariff offered by British Gas represents the best deal for the average householder, costing an average of £1018.38 per year, which is over £200 lower than the average paid by consumers on a standard tariff and paying by quarterly cash or cheque.

Scott Byrom, utilities manager at price comparison site moneysupermarket.com, said:

“Paying by MDD should be the first port of call for people looking to save money. This option allows bill payers to spread the cost of their gas and electricity bills equally each month – rather than having to fork out for the large bill that lands on their doorstep each quarter. An online account allows customers to enter ‘actual’ meter readings quickly and easily – ensuring they pay for exactly what is used, not an estimation.”

“Changing to an online tariff gives consumers the opportunity to keep track of their payments and have a clearer idea of their balance by managing their account online. Online tariffs based on MDD payments are discounted because less administration is needed – so bill payers can cut out what can be poor customer service from call centres, saving cost, time and paperwork, in one fell swoop.”

“Despite E.ON’s price cut of 3.3 per cent to gas last week, British Gas’ Websaver 3 tariff is still the current market leader, and provides an ideal option for people looking to save the most cash. Consumers should keep their eyes peeled however as there could be more cuts to follow. Scouring the market is crucial for those wishing to reduce their bills and find the best tariff to suit their needs.”

If you are concerned that you may be on an necessarily expensive tariff, TotallyMoney.com can help. Visit http://www.totallymoney.com/utilities/ now to compare deals in your area. You could save hundreds per year.