70,000 Nationwide customers to be refunded

70,000 Nationwide customers to be refunded

The Competitions and Markets Authority has ordered Nationwide to refund customers following a breach of overdraft rules.

 

Brean Horne Fri, 02/07/2020 - 11:33

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Nationwide is to repay customers £900,000 after breaching overdraft rules set out by the Competition and Markets Authority (CMA).

Customers with a personal current account must receive a text alert warning of fees before banks charge them in an unarranged overdraft, under Part 6 of the CMA’s Retail Banking Code.

The rules aim to give people time to take action and avoid paying unexpected overdraft fees.

Although Nationwide did send text alerts, they did not contain a warning that customers would be charged for using an unarranged overdraft.

Around 70,000 customers were affected by the breach.

What happens next?

Nationwide has put an independent auditor in place to review its processes, as directed by the CMA, and has begun refunding its customers.

The refunds paid by the building society cover all fees incurred by customers from going into unarranged overdraft.

It is the second time in six months the CMA has taken action against Nationwide for breaking this order.

In August 2019 Nationwide had to pay a £6 million refund to hundreds of thousands of customers.

Adam Land, senior director of remedies, business and financial analysis at the CMA says: “Banks and building societies that fail to send customers text alerts saying they will be charged if they enter an unarranged overdraft are breaking the rules.

“The fact that Nationwide is a repeat offender makes it even more serious.

“Following our action, it will now repay all affected customers, and quickly.

“This is exactly the sort of issue we would expect to fine companies for in future, if the Government gives us the increased powers we’ve asked for.”

Nationwide say that they are in the process of contacting affected customers and will issue refunds automatically. 

Sara Bennison, chief marketing officer at Nationwide Building Society, says: “The CMA Directions, issued to Nationwide in August 2019, required the Society to complete an independent review of its processes in relation to text alerts.

"While all members received their texts on each and every occasion, this review identified that alerts sent to members who were in Collections did not explicitly state that they would be charged an unarranged overdraft fee.

“While these members haven’t been overcharged, we appreciate these texts are designed to help people avoid unarranged overdraft charges, so we apologise that on this occasion we didn’t meet the high standards we set ourselves.

"We are contacting impacted members and will be automatically refunding the charges back into their account.

“From 11 November 2019, the Society removed unarranged overdraft charges, so this issue will not occur again in the future.”

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Deal of the week: Valentine's Day deals special

Deal of the week: Valentine's Day deals special

Valentine’s Day can be expensive, but it does not have to cost you a fortune. Here is a round up of the best Valentine’s Day deals

Stephen Little Fri, 02/07/2020 - 11:06

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What’s the deal exactly?

Flowers

One of the biggest romantic gestures you can make on Valentine’s Day is to send flowers.

Marks and Spencer is selling a dozen red roses for £20. The stem length is £50cm and delivery is free.

The cheapest roses at Waitrose start at £25 for a dozen, going all the way up to £100 for a luxury bouquet.

If you are looking for something a little bit cheaper, Tesco has a traditional bouquet of 12 short-stem red roses at £5, available from 10 February.

Asda also has lots of different offers, with a bunch of roses starting from £2.

Eating in

Going out to a restaurant can be expensive, so how about staying in for a romantic evening?

Marks and Spencer has a delicious three-course meal for just £20. You can choose from any starter, main, side, dessert and wine. The offer runs from 10-14 February

Tesco’s three course Valentine's Day meal gives you the choice of a starter, two mains, a dessert and a drink, all for just £20.

The deal is made up of 27 products, which allows you to choose from more than 15,000 combinations.

Starters include salmon and watercress tart filled with a crème fraiche and creamy cheddar cheese sauce, while the mains include chicken in champagne sauce and lamb shank and roasted vegetables.

Morrison’s is offering shoppers a three-course Valentine’s Day meal with a bottle of wine or Prosecco for £15 from 10 to 16 February.

Asda has a £15 meal which includes a starter, main, two sides, dessert and a drink, running until 16 February.

Restaurants

Pizza Express – Three course set menu for two people for £28.95 on 14 and 15 February only. Example menu - garlic dough balls, American pepperoni pizza and a glass of Prosecco.

Carluccio's – Three courses from its special Valentine’s Day menu for £24.95, available from Wednesday 12 February to Sunday 16 February. Example menu – chicken breast in prosciutto, ricotta and spinach ravioli, crab and langoustine fettucce, and rhubarb panna cotta.

Prezzo – Two courses for £16.50 or three courses for £19.50. Available from Thursday 13 February until Sunday 16 February. Example menu – grilled chicken breast with mushrooms, goat’s cheese and red pepper pizza and honeycomb smash cheesecake.

Zizzi – Get three courses from its special Valentine’s Day menu for £21.95 per person, available from Thursday 13 February until Sunday 16 February. Example menu – tortellini filled with pumpkin, chicken breast with sage, and passion fruit cheesecake.

Why should I care?

Valentine’s Day can be an expensive business, so it is always wise to take advantage of any discounts.

What’s the catch?

If you are going out for a meal or eating in, you will be limited by the options on the set menu.

What other options do I have?

Have a look round your local restaurants as they might be running a special Valentine’s Day deal.

You can also read the weekly updated Moneywise Cheap Eats guide to see the best restaurant offers which are unrelated to Valentine’s Day.

Where can I find out more?

You can find more information about the deals on the Marks and Spencer, Tesco, Asda, and Waitrose websites.

For more information about Carluccio's, Pizza Express, Prezzo and Zizzi go to their websites.

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Energy price cap will fall by £17 from April

Energy price cap will fall by £17 from April

Ofgem says millions of households will save on energy bills.

Emma Lunn Fri, 02/07/2020 - 09:14

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The energy price cap will fall from £1,179 to £1,162 for the summer period (April to September), due to lower wholesale costs.

The level of the prepayment meter cap will also fall by £17, from £1,217 to £1,200 per year for the same six-month period.

Ofgem says the caps protect about 15 million customers from being overcharged for gas and electricity.

What is the energy price cap?

The energy price cap establishes a maximum price that can be charged per unit of energy, and a maximum that can be charged per day as a standing charge.

The cap is reviewed every six months and will rise or fall based on the costs that Ofgem calculates suppliers need to spend to get energy to your home.

Jonathan Brearley, chief executive at Ofgem, says: “The default price cap is designed to protect consumers who do not switch from overpaying for their energy, whilst encouraging competition in the retail market. 

“Suppliers have been required to become more efficient and pass on savings to consumers. In its first year, the cap is estimated to have saved consumers £1 billion on average on their energy bills and switching rates have hit record levels.” 

Why has the price cap fallen?

A large part of the reduction in the caps is due to wholesale energy prices continuing to fall between August 2019 and January 2020. A strong supply of gas, such as record amounts of liquefied natural gas and healthy gas stock inventories, has been the main factor pushing down wholesale prices. 

As a result, the wholesale energy cost element of the default tariff cap fell from £446 to £408.

These reductions offset cost increases totalling £22 of other elements such as operating costs, network charges, smart meter costs and environmental schemes, resulting in an overall reduction of £17 in the level of the default tariff cap.

Shop around to save money

The energy price cap applies to energy suppliers’ standard variable or default tariffs. Energy users are often switched to these tariffs at the end of a fixed rate deal.

Switching away from a default tariff to a cheaper deal could save a typical household more than £300 a year according to Compare The Market.

Ed Dodman, director of regulatory affairs at the Energy Ombudsman, says: "This reduction in the price cap is good news for the millions of UK households currently on default tariffs, but shouldn’t discourage people from shopping around for better deals.  

"When switching, we would encourage consumers to look at the customer service they can expect to receive as well as how much money they could save.”

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This week's best current accounts

This week's best current accounts Stephen Little Fri, 02/07/2020 - 08:00

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First published on 8 May 2013

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Household water and sewerage bills set to fall by £17 this year

Household water and sewerage bills set to fall by £17 this year

Water bills are set to fall after the regulator demanded price cuts from firms

Stephen Little Thu, 02/06/2020 - 10:59

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Average household water and sewerage bills will be cut by £17 this year in England and Wales.

Water UK, the industry trade body, says the average water bill will drop by 4% to £396.60 from 1 April, although there will be variations from company to company.

Christine McGourty, Water UK chief executive, says the water industry is “committed to giving customers good value for money”.

She says: “For around £1 a day, customers get the world-class quality water they need and their wastewater managed responsibly.

“Companies are also committed to investing for the future and protecting the environment, with an ambitious goal to achieve net zero carbon emissions for the sector by 2030.

“And companies are increasing the assistance available for customers who need it most. The number of people getting help to pay their water bills will almost double, whether that’s through reduced tariffs or targeted support.”

The news comes after the regulator Ofwat said in December that water firms in England and Wales must cut the average household bill by £50 – or 12% - over the next five years.

The decision forms part of a £51 billion investment package to improve services for customers.

An Ofwat spokesperson says: “We continue to push companies to deliver improved services for customers, the environment and resilience for generations to come whilst making sure that bills are fair.

“Today’s announcement that water bills have fallen by an average of 4% has been secured because we have demanded greater efficiency, passing through lower financing costs and promoting more innovation.”

Water UK says there is also going to be more help for customers who find it difficult to pay.

It says water companies plan to almost double the number of people getting help with their bills every to at least 1.4 million by 2025.

Should you get a water meter?

The Consumer Council for Water (CCW), the industry watchdog, says customers could make even bigger savings by installing a water meter.

Getting a water meter could slash your water bills by more than £100 a year. Most companies will usually give customers up to two years to trial a meter and switch back if they are worse off or unhappy.

Andy White, CCW’s senior policy manager, says: “Many households don’t feel they get a fair deal from their water company but over the next five years customers are set to receive more for their money – and we want them to take full advantage.”

“There are still millions of households who could tap into savings by switching to a meter or cut their bills if they’re on a low income by signing up to their company’s social tariff.”

With a water meter you will get charged for what you use, rather than a flat rate.

If you live in England and Wales you can get one fitted for free.

The amount of money you save will depend on factors including your usage, how much you currently pay and the number of people living in your property.

Getting a water meter installed does not necessarily mean you will save money though.

A water meter is most likely to benefit those living alone or using small amounts of water.

If your house has a high rateable value it may also be worth changing. This is because water bills are calculated on the rateable value of the property.

As a rule of thumb, you will be paying less if there are more bedrooms than people in your household.

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Asda slashes petrol prices again, but cuts should have come sooner says RAC

Asda slashes petrol prices again, but cuts should have come sooner says RAC

It is the second time Asda has cut prices in a week

Stephen Little Wed, 02/05/2020 - 11:10

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Asda has cut fuel prices for the second time in a week, knocking 2p a litre off petrol and 4p a litre off diesel.

Drivers filling up at any of Asda’s’s 322 petrol stations will benefit from the price cut, which has now seen the retailer bring fuel prices down by up to 7p per litre during the last week.

Drivers filling up at any Asda filling station will pay no more than 118.7p for unleaded and 120.7p on diesel.

Asda shaved 3p off a litre of petrol last week, sparking a price war among the supermarkets.

Morrison’s, Sainsbury’s and Tesco are expected to follow Asda’s lead once again.

Asda senior fuel buyer, Dave Tyre, says: "We’re pleased to be passing on these wholesale cost prices to customers for the second time in two weeks as the price of oil continues to fall.

“This is the second time in a week we’ve led a price cut, bringing the cost of fuel down by up to 7p per litre.

“We will continue to put the savings straight back into drivers' pockets without any vouchering requirements meaning all our customers, regardless of their budget, will benefit from a price cut at the pumps.”

Cuts should have come earlier

While the cuts are good news for motorists, the RAC says they should have come earlier.

The UK’s big four supermarkets increased petrol prices every day during January until the cuts were announced at the end of the month.

This was despite a fall in wholesale price of petrol in January, mainly due to the fall in demand in China because of the coronavirus outbreak.

The RAC says this should have led to a price reduction at the pumps in January, but instead retailers put their prices up for the second consecutive month.

A litre of unleaded rose 0.92p to 127.60p in January, according to RAC data.

Diesel is now 132.04p, up from 131.08p at the start of the month.

However, at the supermarkets, unleaded rose 1.51p on average to 123.69p, while diesel was up 1.30p to 128.14p.

RAC fuel spokesman Simon Williams says: “Based on steadily falling wholesale prices January should have been a good month for drivers at the pumps, but instead they ended up paying well over the odds.

“Retailers were very quick to protect themselves from a slight jump in the price of oil caused by the tensions between Iran and the US at the start of January by putting up forecourt prices, but when the cost of a barrel dropped back, for some reason, retail prices carried on going up.

“Our biggest retailers – the supermarkets – blatantly resisted passing on the savings they were making to drivers until the RAC publicly called on them to do so.

“This was clearly good news, but it’s hard to congratulate retailers on doing something they should have done at least a week before. Even since the cut pump prices are still out of kilter with what’s been happening on the wholesale market. As things stand now – despite the cuts – petrol is still 5p too expensive and diesel over 7p too dear.

 “We strongly urge retailers of all sizes to play fair with drivers and cut their forecourt prices. Going forwards we call on them to charge prices that more closely mirror drops in the cost they buy fuel in at in the same way they do when prices go up.”

 Regional fuel prices

Those living in Northern Ireland saw the largest monthly price increase of unleaded in the UK of 0.92p, taking a litre to 125.62p. The smallest increase was in London, with prices rising by 0.52p to £128.26p. Prices fell in the North West by 0.14p to 126.78p.

Regional average unleaded pump prices

Area	02/01/2020	30/01/2020	Change
UK average	126.68p	127.60p	0.92
Northern Ireland	123.83	125.62	1.79
North East	124.52	126.25	1.73
Wales	125.29	126.87	1.58
Yorkshire And The Humber	125.57	126.71	1.14
Scotland	125.76	126.88	1.12
East	126.82	127.87	1.05
South West	126.35	127.38	1.03
East Midlands	126.40	127.40	1.00
West Midlands	126.81	127.52	0.71
South East	127.73	128.40	0.67
London	127.74	128.26	0.52
North West	126.92	126.78	-0.14

Source: RAC 2020

Wales saw the biggest increase in the cost of diesel with a litre going up to 130.07p after a 1.56p rise. The South East had the most expensive diesel at 132.08p and Northern Ireland the cheapest at 128.02p. The North West had the smallest monthly increase at 0.70p litre.

Regional average diesel pump prices

Diesel	02/01/2020	30/01/2020	Change
UK average	131.08	132.04	0.96
Wales	130.07	131.63	1.56
Scotland	130.46	131.87	1.41
Northern Ireland	128.02	129.27	1.25
North East	129.42	130.62	1.20
South West	130.90	132.08	1.18
Yorkshire And The Humber	130.04	131.15	1.11
East	131.56	132.49	0.93
East Midlands	130.97	131.88	0.91
South East	132.08	132.96	0.88
West Midlands	130.83	131.70	0.87
London	131.52	132.27	0.75
North West	130.52	131.22	0.70

Source: RAC 2020

How to cut down on your fuel costs

Here are some handy tips to help you reduce your fuel costs.

Shop around

To save wasting fuel hunting down the cheapest forecourts you can enter your postcode at on PetrolPrices.com or Confused.com.

Make sure your journey to the garage does not cancel out the savings made though.

It is also best to avoid filling up at a motorway service station as these tend to be more expensive.

Regular maintenance

Making your car more fuel-efficient can also help you cut down on your petrol bills.

Regular maintenance and servicing can significantly help improve fuel efficiency.

A poorly-tuned engine can reduce fuel economy by 10% or more, so it is a good idea to get your car regular serviced.

Under-inflated tyres can increase fuel consumption, so make sure they are pumped up properly.

Excess weight can also hurt fuel economy, so remove anything that is not essential, such as roof racks.

Supermarket loyalty schemes

Supermarkets such as Morrison’s, Sainsbury’s and Tesco all have loyalty schemes that transfer the benefits from your daily shopping to the petrol pumps.

If you have a Sainsbury’s nectar card you can use it to fill up at Sainsbury’s and BP forecourts. For every litre of fuel you buy you will get one nectar point – worth half a penny. While it might not sound like much it could save you around £5 for every 10,000 miles on average.

With a Tesco Clubcard you will get one point for every £2 you spend at a Tesco petrol station. For every 150 points you will get £1.50 in vouchers, which you can then use in-store.

With the Morrison’s More scheme you earn five points per litre when you buy fuel. You can also earn five points for every £1 you spend in store and online.

Once you get to £5,000 points you will get a five pound voucher.

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New funding for mortgage prisoner research

New funding for mortgage prisoner research

The research will look for solutions to help homeowners trapped on expensive mortgages.

Emma Lunn Wed, 02/05/2020 - 09:17

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The research by the London School of Economics and Political Science (LSE) will look for solutions to help homeowners trapped on expensive mortgages. 

Its aim is to find evidence-based policy solutions, which will push the Government to step in and rescue the mortgage prisoners the Financial Conduct Authority (FCA) hasn’t helped. 

Martin Lewis is making a personal donation of £25,000 through his charitable foundation to help fund the study. 

What are mortgage prisoners?

“Mortgage prisoners” are homeowners who are unfairly trapped on an expensive mortgage, often with inactive lenders.

When these borrowers try to remortgage to cheaper deals they are often told they don’t meet affordability tests brought in after the financial crash – even though their new payments would be cheaper and they have not fallen behind on payments previously.

What is being done to help mortgage prisoners?

In May 2018, the FCA found 150,000 consumers in the UK were mortgage prisoners. The regulator said it was able to help 30,000 of these who were with lenders the FCA could force to help their trapped customers. But the other 120,000 borrowers had had their mortgages bought by firms who aren't authorised to lend – so the FCA doesn’t have the power to make them do anything.

The FCA announced a “modified affordability assessment” last year for borrowers who meet certain criteria and want to remortgage. However, it says that many lenders haven’t been interested in implementing the new assessments.

In January 2020, FCA research found there were 250,000 people whose mortgages were with inactive or unregulated lenders. Of these, 170,000 were up-to-date with payments.

The cost of mortgage prisoners

Lewis says: "It’s time the Government accepted the responsibility to find a solution for these vulnerable consumers. Its failure to do so is short-sighted. The cost of mortgage prisoners doesn’t just fall on the individuals, it falls across society.

"The impact of leaving people locked in to unaffordable mortgages can be catastrophic. It can leave them dependent on the state, with little savings for old age, and even adding to NHS costs with the hideous and disastrous mental health impact that can occur when you destroy someone’s financial life choices.

“So, over the next few months, we’re asking the LSE to explore a range of cost-effective, practical policy solutions the Government could employ to rescue mortgage prisoners – which we can then take to the Treasury.”

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LV= launches new car insurance voice app

LV= launches new car insurance voice app

LV= car insurance customers can now check their car insurance policies using their smart speakers. 

Brean Horne Mon, 02/03/2020 - 11:06

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LV= General Insurance has launched a voice app allowing customers with Amazon Alexa or Google Home Assistant products to ask questions about their car insurance policies.

LV= says it is the first direct car insurer to launch a voice app.

The voice app can answer over 500 questions about car insurance which are based on commonly asked questions on LiveChat and the call centre.

These questions include:

• "What is the password to open my documents?"
• "What is the difference between voluntary and compulsory excess?"
• "How do i change the payment date for my policy?"
• "How do I protect my no claims discount?"

To get started, customers will need to ask their smart speaker to "open LV" followed by a question about their policy. 

LV= developed the voice app to help customers who are less able to use a computer or telephone to check their documents.

The insurer also hopes to reduce some of 28,000 questions on policy documents that are received by call centre staff each month.

Plans are in place to add other products to the app in the future.

Jon Mansley, sales and marketing director at LV= says: “At LV= GI we’re always trying to make things easier for our customers, so with nearly 13 million smart speakers sold in the UK in 2019 we thought a voice app would be helpful.”

“With the launch of this new voice skill, customers can now find out details of their policy in a matter of seconds, simply by asking their smart device.”

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One million miss tax deadline: can you appeal?

One million miss tax deadline: can you appeal?

Almost one million people face fines for missing the tax return deadline on Friday 31 January. Will they be able to appeal?

Brean Horne Tue, 02/04/2020 - 11:28

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Nearly one million taxpayers have missed the self-assessment tax return deadline of January 31 and have been fined.

Some 958,296 taxpayers missed the crucial deadline, the latest data from HM Revenue and Customs (HMRC) revealed.

Those who missed the deadline face the following fines:

• One day late: £100
• Three months late: £10 per day, plus the above penalty
• Six months late: the highest of £300 or 5% of the tax due, plus the penalties above
• 12 months late: all of the above penalties plus the higher of £300 or 5% of the tax due. (In some cases you could be fined 100% of the tax owed to HMRC)

Angela MacDonald, director general for customer services at HMRC says: "Customers who have missed the deadline should contact HMRC.

"The department will treat those with genuine excuses leniently, as it focuses penalties on those who persistently fail to complete their tax returns and deliberate tax evaders.

The excuse must be genuine and HMRC may ask for evidence."

Legitimate excuses for filing late

If you have a genuine excuse for filing your tax return late you may be able to appeal your late fine.

Each appeal will be decided on a case by case basis.

HMRC may accept the following reasons:

• Serious illness
• The death of a partner or family member
• Fire, flood or theft
• Computer failure
• Issues with HMRC’s online services

Appeals will be decided on a case by case basis and if yours is successful, you'll need to make your payment as soon as possible after your excuse is resolved. 

Check out GOV.UK for a full list of legitimate reasons HMRC will accept. 

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Cost of TV licence set to rise for fourth year in a row

Cost of TV licence set to rise for fourth year in a row

The increase is a further blow to over-75s who must start paying the TV licence from June

Stephen Little Tue, 02/04/2020 - 10:29

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The cost of the annual television licence fee is set to rise from £154.50 to £157.50 on 1 April, the fourth year in a row it has gone up.

The Government, which sets the level of the licence fee, announced in 2016 it would rise in line with inflation for five years from 1 April 2017.

The new licence fee amount equates to just £3.02 a week or £13.13 a month.

The BBC is under fire over its decision to scrap free licences for the over-75s from June 2020.

Caroline Abrahams, charity director at Age UK, says the increase is another blow to the hundreds of thousands of over-75s who will struggle to afford a TV licence when they are axed.

She says: “The clock is ticking, and with only a few months to go, the BBC and the Government must urgently sit down and broker a solution to the TV licence debacle.

“Many of the over-75s who will lose their free licence are housebound due to ill health and disabilities and are almost completely reliant on their TV for entertainment, companionship and as a way to stay connected with the rapidly changing world.”

The news comes after the BBC announced it was cutting jobs as part of a bid to save tens of millions of pounds.

The broadcaster provides nine national TV channels plus regional programming, 10 national radio stations, 40 local radio stations, national radio services, news websites and the iPlayer.

In the last financial year 95% of the BBC’s controllable spend went on content for audiences and delivery, with just 5% spent on running the organisation.

Backlash

The BBC is facing backlash over its decision to scrap free TV licences for the over-75s.

From 1 June 2020, up to 3.7 million pensioners aged over 75 will have to start paying for the TV licence unless they claim pension credit.

Age UK has warned that those on low incomes, battling loneliness, ill health and disabilities will be hardest hit by the removal of the licence fee concession.

It says that the decision could exclude some of the poorest and oldest pensioners from watching TV.

In 2015, the Government announced it would no longer subsidise the cost of the licence fee for over-75s and the BBC would have to find the funding itself, starting in 2020.

This left the BBC with the choice of either scrapping the concession for the elderly or cutting broadcasting services.

Ministers are currently debating whether to decriminalise non-payment of the TV licence fee.

This would mean replacing the current system of criminal sanctions for non-payment with fines.

Are you still eligible for a free TV licence?

Around 1.5 million households that include someone over 75 claiming pension credit could still be eligible for a free licence.

However, Age UK estimates that two in five of all those eligible don’t claim pension credit, often because they don’t realise they are eligible.

In order to claim pension credit your weekly income must be less than £167.25 if you’re single, or £255.25 if you are a couple.

The quickest way to apply for pension credit is to call the pension service on 0800 991234. Alternatively, you can check your eligibility online on the government website at https://www.gov.uk/pension-credit.

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Energy price cap failing to save people money

Energy price cap failing to save people money

Households can save an average of £324 a year by switching to one of the most competitive dual fuel tariffs.

Emma Lunn Tue, 02/04/2020 - 09:22

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The gap between the best priced energy tariffs and the prices charged to those on standard variable or default tariffs has widened, according to Compare the Market.

The energy comparison site calculated that since October – when the price cap was set at £1,179 – the price of the most competitive energy tariffs available has fallen by an average of £73.

The average price for the top 20 cheapest available tariffs currently stands at £855 – meaning people on standard tariffs could be £324 better off by switching.

What is the energy price cap?

The energy price cap establishes a maximum price that can be charged per unit of energy, and a maximum that can be charged per day as a standing charge.

The cap is reviewed every six months and will rise or fall based on the costs that Ofgem calculates suppliers need to spend to get energy to your home.

But a survey by Compare the Market found that just 16% of households have heard of the price cap and can explain what it is.

Almost a third (32%) have not even heard of the price cap while more than half (52%) have heard of it but cannot explain what it involves. Just 5% of consumers can say what the current price cap level is.

Compare the Market’s Price Cap Update shows that since the introduction of the current price cap on 1 October 2019, prices in the market have dropped, with the average cheapest available dual fuel tariff falling by £73, from £928 to £855.

Even if the price cap was to fall by the equivalent amount, consumers would still be more than £250 better off by switching provider.

The price cap is next due to be revised on 1 April.

Households missing out on savings

The growing price gap between the most competitive tariffs and the prices charged to those on standard variable or default tariffs, means about 11 million customers on a default or standard variable tariff are collectively missing out on a combined £3.5 billion savings by not switching to a better deal.

Peter Earl, head of energy at Compare the Market, says: “Our research shows that the price cap has done little to safeguard those people on a standard or variable rate tariff. The more affordable prices available on the market to those that shop around clearly show that the level of the price cap is a rip off. Too few people are switching suppliers, leaving millions of people paying too much for their energy.

“Even if the next price cap drops to the lowest level since it was first introduced, people should not see this as a good value price to pay for energy – rather, it is the absolute ceiling of what they should be paying. It is evident from our findings that understanding of the price cap is low. We would encourage anyone on a standard or variable tariff to review their current provider to see if they can find a better deal elsewhere.”

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Best mortgage deals for home movers

Best mortgage deals for home movers Stephen Little Tue, 02/04/2020 - 07:59

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First published on 29 July 2015

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Remortgage to cut your monthly payments

Remortgage to cut your monthly payments Stephen Little Tue, 02/04/2020 - 07:58

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First published on 29 July 2015

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Premium Bonds February 2020: did you win the jackpot?

Premium Bonds February 2020: did you win the jackpot?

February’s premium bond winners have been revealed, find out if you’ve scooped the £1m jackpot.

Brean Horne Mon, 02/03/2020 - 11:40

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February’s premium bond winners have been revealed, find out if you’ve scooped the £1m jackpot.

Two lucky premium bondholders scooped the £1m jackpot prize in February’s draw.

ERNIE’s first jackpot draw - 350ZA848545 - belongs to a woman living in Nottingham who only purchased her winning Bond just last year in January 2019.

She holds a total of £37,575 in premium bonds and becomes the seventh jackpot millionaire in Nottingham.

This month’s second millionaire is a man from Surrey who purchased his winning Bond in October 2002. The winning Bond number 050RE855967 is part of a total holding of £4,014.

He is the 24th jackpot winner from the county.

Over 3.48 million prizes worth £99,580,850 were awarded this month. The winnings ranged between £25 and £1m.

Over one million unclaimed prizes

There are more than 1.7 million prizes worth over £64 million still waiting to be claimed by Premium Bonds prize winners.

In Nottingham there are 12,437 unclaimed prizes worth £455,900.

There are six unclaimed prizes worth £1,000 won between August 1985 and August 2014.

The oldest unclaimed prize in Nottingham is £25 and was drawn in June 1964, with a total holding of £1. The winning Bond number is AK712860.

There are 46,761 unclaimed prizes in Surrey with a total value of £1,676,600.

The highest value unclaimed prize in the area is £10,000 and there are two such unclaimed prizes.

The first was drawn in March 2014 with Bond number 22KZ175159. The second was drawn in March 2018 and the winning Bond was 5JT290436.

The oldest unclaimed prize in the county is £25 and dates back to September 1963, with a total holding of £1 and the winning Bond number of 1AS033592.

How to check if you have an unclaimed prize

If you think you have an unclaimed Premium bond prize, you can use NS&I’s tracing service or the My Lost Account website to help you track them down.

You’ll need to provide details such as your full name, address and an estimate of how many Premium Bonds you hold and how long you’ve had them.

 

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Credit card firms may have to cut or scrap fees for those in persistent debt, says FCA

Credit card firms may have to cut or scrap fees for those in persistent debt, says FCA

The financial watchdog has thrown a lifeline to millions of people in debt and at risk of having their accounts suspended

Stephen Little Mon, 02/03/2020 - 11:08

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Credit card companies must cut or waive fees for people in persistent debt rather than issuing them with blanket suspensions, the UK financial watchdog has announced.

The Financial Conduct Authority (FCA) has written to credit card firms telling them to review their approach to borrowers who are stuck in persistent debt.

It says that if a customer can’t afford to pay, the firm may have to consider either waiving or cutting any interest or charges.

The watchdog has also told firms that they are not allowed to suspend a credit card without having an objectively justifiable reason.

Lenders were told by the FCA in 2018 that they must help people who have been persistent debt for three years by agreeing plans with them to resolve the situation.

Under the rules, credit card firms were told to contact customers who had been in persistent debt for 18 months and making low or minimum payments. Customers were then given a further 18 months to make increased payments.

The FCA was concerned that if customers had not increased payments or responded to letters from their credit card provider, some providers may have been planning a blanket suspension of their cards. 

Jonathan Davidson, executive director of supervision for retail and authorisations at the FCA, says: “Under our rules, firms must help customers to reduce the level of debt they have on their credit card more quickly. If a customer cannot afford the firm’s proposals for how to do this, the firm must offer forbearance, potentially including reducing, waiving or cancelling any interest, fees or charges. 

“My advice to consumers is don’t bury your head in the sand. If you can’t afford to meet the repayment schedule that the credit card firm is suggesting, don’t be afraid to tell them. If we find firms are not offering their customers the appropriate level of help, we will not hesitate to take action."

Persistent debt

A persistent debt is one when where you pay more in interest and charges on your credit card than on repaying the amount borrowed.

Around four million people in the UK have persistent high levels of credit card debt, which they struggle to repay.

The FCA estimates that getting customers out of the debt cycle could save them £1.3 billion a year in lower interest charges.

Peter Tutton, head of policy at debt charity StepChange, says: “The FCA is unequivocal that firms should not cancel people’s cards wholesale.

“We particularly welcome the regulator telling firms to include in their letters a reminder that forbearance is available if people cannot afford what is suggested, and that they should signpost to independent advice for those receiving letters from more than one card provider.”

Rachel Springall, finance expert at Moneyfacts, says: “The FCA may well have thrown struggling credit card borrowers a lifeline today, as its warning could stop lenders from cancelling a credit card without a justifiable reason.

“Since the persistent debt proposals were announced, credit card providers have cut down the length of interest-free balance transfer offers, of which there is a record low amount of deals available now. Once the longest offer was for a 43-month interest-free balance term, while the longest today is just 29 months, a significant difference.

“Hopefully this interjection from the FCA will protect vulnerable consumers who need more guidance on ways to reduce their debts. However, if card providers are forced to reduce or abandon interest charges on debts, then this could impact the range of credit card deals that they are prepared to offer overall.

Reducing your debt

Setting a budget is often the first step to help you get on top of your finances. Knowing how much you have coming in every month and what you need to spend helps you work out the best way to deal with your debts.

Some debts are more important to deal with than others, so make sure you prioritise those first.

Although credit card interest might be higher than your mortgage, missing mortgage payments can have more serious consequences as you could lose your home.

Credit card debt can be expensive, so it makes sense to pay this off as quickly as possible.

Council tax is another important bill to keep on top of. You could be sent to prison for up to three months if you fail to pay it.

Balance transfer cards allow you to consolidate all your debt in one manageable payment. Transferring over to a credit card that offers 0% interest on purchases can make debt repayments easier.

Some of the best deals will allow you to borrow for more than two years, giving you extra breathing space to pay off your debt.

Where to get help

StepChange is a charity that offers free and confidential debt advice over the telephone and online. To get in touch, call 0800 138 1111 or go to its website at stepchange.org.

National Debtline is a free telephone debt advice service for people in England, Wales and Scotland. Go online at nationaldebtline.org or call 0808 808 4000.

Citizens Advice and Citizens Advice Scotland provide face-to-face support at more than 3,500 locations across the UK.

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