Friendly credit explained

Friendly credit is a vital safeguard for households using prepayment meters, designed to prevent energy supply disconnections when topping up is difficult or impossible. This mechanism ensures homes remain powered, particularly during evenings, weekends, and bank holidays, offering a temporary reprieve until customers can add more credit to their meters. It acknowledges the realities of daily life and the need for continuous energy supply.

Managing your energy should be straightforward, not a source of constant worry. Fuse Energy offers a clear, digital-first approach to energy supply for credit meter customers, focusing on transparent billing and in-app management. Click here to switch to Fuse Energy today and experience a different way to manage your home's energy.

What is friendly credit?

Definition and purpose

Friendly credit is a specific feature offered by energy suppliers to customers with prepayment meters. Its primary purpose is to prevent disconnections from energy supply during periods when topping up might be challenging, such as overnight, weekends, or public holidays when shops or top-up points may be closed. This ensures that essential services like heating and lighting remain available, acting as a crucial safety net. Ofgem, the UK's energy regulator, sets rules and guidance for energy suppliers regarding prepayment meters, including the provision of friendly credit, making it a mandatory licence condition for suppliers.

It's important to understand that friendly credit is not free energy; rather, it's a temporary loan that must be repaid.

Who benefits from friendly credit?

Friendly credit primarily benefits customers who use prepayment meters for their gas and electricity supply. These meters require customers to pay for their energy in advance, which can help with budgeting but also carries the risk of running out of credit at inconvenient times. Friendly credit acts as a protective measure for these individuals, ensuring they don't lose power during unsocial hours or when top-up facilities are inaccessible. This is particularly vital for vulnerable customers who might be on the Priority Services Register.

How does friendly credit work?

Eligibility and activation

Friendly credit typically activates automatically if a prepayment meter runs out of credit during designated "friendly hours". You usually don't need to manually activate it; the supply simply continues uninterrupted. While most modern smart prepayment meters automatically provide friendly credit, it's always a good idea to check with your specific energy supplier, as policies can vary. Some older traditional (non-smart) meters may also offer friendly credit, but if not, your supplier might be able to arrange a meter replacement.

Typical friendly credit hours and days

Friendly credit hours are specific periods designed to cover times when topping up might be difficult. While exact times can vary by supplier, common friendly credit periods include:

• Weekdays: From evening until the morning of the following day. For example, some suppliers might offer it from 6pm to 9am.
• Weekends: Often from Friday evening until Monday morning. This can start as early as 2pm on a Friday and last until 10am on Monday.
• Bank holidays: All day on bank holidays, often extending until the morning of the next working day.

These hours ensure that if your meter runs out of credit, your supply won't be cut off until top-up points are likely to be open again. It's worth noting that some traditional gas prepayment meters may not support friendly credit.

Repaying used friendly credit

Any energy used during friendly credit periods is not free. It is automatically recovered from your meter the next time you top up. For example, if you use friendly credit and then top up, the amount used will be deducted from your top-up, leaving you with the remainder as usable credit. Your meter or in-home display will typically show how much you owe. If you struggle to repay the amount, it's crucial to contact your supplier to discuss a repayment plan.

Managing your prepayment meter effectively

Strategies to avoid running out of credit

Managing a prepayment meter effectively can help minimise reliance on friendly credit and prevent unexpected disconnections.

1. Regularly check your balance: Keep an eye on your meter balance or in-home display to know when you're running low. Many smart meters can alert you when credit is low.
2. Top up in advance: Plan to top up your meter before weekends, bank holidays, or if you know you'll be using more energy than usual. Understanding your energy consumption can help you budget more accurately and avoid surprises.
3. Use your supplier's app or online services: Many suppliers offer apps and online portals for easy top-ups. You can also top up at PayPoint or Payzone outlets.
4. Understand your usage: Monitoring your energy consumption can help you budget more accurately and avoid surprises. For more tips on reducing your energy use, consider reading about energy efficiency tips.

Understanding emergency credit

Emergency credit is a separate mechanism from friendly credit, though both serve as safety nets. It's a fixed amount of credit that you can typically activate from your meter when your balance gets low. This gives you a short window to top up before your supply cuts off. Emergency credit is usually available at any time your meter balance is low, allowing you to choose when to activate it. The amount available can vary by supplier and meter type. Like friendly credit, any emergency credit used must be repaid with your next top-up. Suppliers are required to offer emergency credit to customers struggling to top up their prepayment meter.

Seeking support from your supplier

If you are struggling to top up, are at risk of going off supply, or have already gone off supply, contact your energy supplier immediately. They can offer various forms of support, including repayment plans, additional support credit for vulnerable customers, or credit advances. Citizens Advice (England and Wales) provides free, independent and confidential advice on 0808 223 1133 or at www.citizensadvice.org.UK/energy/.

The limitations of friendly credit

Friendly credit as a short-term solution

Friendly credit is designed as a temporary measure to prevent immediate disconnection, not a long-term solution to energy affordability challenges. While it offers a crucial safety net, particularly during unsocial hours, it doesn't address the underlying reasons why a customer might be struggling to keep their meter topped up. The credit used must still be repaid, which can lead to a larger deduction on the next top-up if not managed carefully.

The stress of prepayment meters

The constant need to monitor credit and the fear of running out of energy can be a significant source of stress and anxiety for prepayment meter users. This "scarcity mindset" can lead to self-rationing, where individuals deliberately limit their energy use to avoid going off supply. Ofgem has expressed concerns about customers self-disconnecting and has introduced measures to improve conditions for prepayment customers.

Beyond friendly credit: a different approach to energy

Moving away from prepayment anxiety

While friendly credit offers a temporary reprieve for prepayment meter users, a more fundamental shift in energy management can help eliminate the underlying need for such emergency measures. Fuse Energy believes that the "scarcity mindset" that has dominated the energy industry for too long needs to be broken. Instead of constantly worrying about running out of credit, the goal should be to empower customers with greater control and predictability over their energy usage and payments. This is part of a broader vision to build a future with "power to play with".

How Fuse Energy empowers customers

Fuse Energy provides an alternative approach to energy management, focusing on empowering customers with superior control and flexibility over their energy usage and payments. Fuse does not currently support customers in prepayment mode; smart prepayment meters can switch to Fuse but will be reverted to credit mode. Instead, for its credit meter customers, Fuse offers:

• Transparent app control: An intuitive, engaging, transparent, and rewarding app and smart meter integration provide clear visibility of energy spend and easy payment options. This real-time visibility helps customers manage their finances effectively and reduces the likelihood of needing emergency measures. You can learn more about smart meter installation and how it can help.
• 24/7 human customer support: Fuse offers continuous human support to help customers proactively manage their energy finances, aiming to alleviate the stress and anxiety associated with energy bills.

Control and flexibility for your energy

Fuse's model aims to prevent the "scarcity mindset" by giving customers the tools and support to manage their energy proactively. By offering clear billing, in-app management, and readily available human support, Fuse seeks to provide a more stable and less stressful energy experience. This approach allows customers to focus on having "power to play with", rather than constantly worrying about running out of credit. Understanding your energy bill is a key part of this control, and you can find more information on understanding your energy bill.

Ready to move beyond prepayment anxiety and take control of your energy? Fuse Energy offers a modern, transparent, and supportive energy experience for credit meter customers. With clear pricing, real-time usage data through an engaging app, and 24/7 human customer support, you can manage your energy with confidence. Switching is quick and easy. Click here to switch to Fuse Energy today and discover a future with power to play with. You can also learn more about our mission to make energy abundant by clicking here.