npower billing failure affected 500,000 people

Written by on December 18, 2015 in BillingViews, News with 0 Comments
  • npower’s billing issues affected over 500,000 customers between September 2013 & December 2014.
  • npower failed to handle complaints effectively within a reasonable timeframe.
  • Since Ofgem’s intervention, npower’s performance has improved, but it must continue to demonstrate improvements to its customers.
  • First investigation to be concluded under Ofgem’s principles-based domestic Standards of Conduct requiring suppliers to treat customers fairly.npower fine

Ofgem is requiring npower to pay £26m as a consumer redress package, following the supplier’s billing and complaint handling failings. The money will be divided between some of the worst affected customers and charity. Ofgem has also agreed targets with npower for it to further improve its billing and complaints handling. If npower fails to meet these targets, it will stop proactive domestic sales activity and advertising until all are met.Many of npower’s problems surfaced after they introduced a new IT system in 2011. Between September 2013 and December 2014, npower issued over 500,000 late bills. Some affected customers also received inaccurate bills with little or no detail on how these were calculated. During this period, npower customers made over 2m complaints with the majority about late or inaccurate bills. npower often failed to resolve these issues promptly, pursued debts which were in dispute and failed to keep its own commitments to customers on billing. This caused significant distress and worry for many.

npower also failed to deal with complaints effectively because of failures with its IT system. For several years, npower has recorded a significant number of complaints incorrectly, leading to unresolved complaints being logged as resolved and multiple records created for one issue. This created follow-up problems for customers. The supplier did not refer all customers to its complaint handling procedures and in some cases, failed to advise them that they could take their complaint to the Energy Ombudsman if unresolved after eight weeks.

Customers do not need to do anything as npower will contact those who have been worst affected.

Dermot Nolan, Ofgem chief executive said: “npower failed its customers. Not only have its billing and complaint handling procedures been chaotic, it treated many of its customers poorly, which is completely unacceptable. npower’s management failed to act quickly enough to protect its customers when things went wrong with changes to its IT system.

“It’s important that all suppliers ensure they follow the principles of treating customers fairly at all times. The payment of £26m sends a strong message to the industry that we expect them to act quickly and effectively to ensure a good customer experience.”

Further notes and details of new targets for npower can be found here.

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About the Author

About the Author: Alex was Founder and CEO of the Global Billing Association (GBA), a trade body focused on the communications sector. He is a sought after speaker and chairman at leading industry conferences, and is widely published in communications magazines around the world. Until it closed, he was Contributing Editor, OSS/BSS for Connected Planet. He is publisher of DisruptiveViews and previously BillingViews. .

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