E.On is to make redress of £650,000 after taking direct debits too early from 1.6 million customers.

A majority of the affected payments were due to be taken in January 2021, but they were wrongly taken on 24 December 2020. This was due to a technical fault, following changes E.On made to friendly credit hours for pre-payment customers between Christmas and New Year. It reported the issue to Ofgem on 24 December.

Ofgem says it meant customers may have experienced out of pocket expenses, piad unexpected overdraft bank charges, had difficulty making payments in the run up to Christmas or suffered other unforeseen circumstances.

Ofgem considers that E.ON failed to conduct the appropriate checks to ensure that this would not lead to any unintended consequences for customers.

E.On made redress and goodwill payments totalling £55,039 to customers who contacted the supplier to say they had suffered additional bank charges, out of pocket expenses or other detriment and has committed to continue to make redress and goodwill payments. It E will pay £627,312 to the energy redress fund in recognition of its failure to address underlying system and governance weaknesses, which would have prevented the error from occurring,.

Anna Rossington, director of retail at Ofgem, said:”Ofgem expects suppliers to adhere to the terms of contracts they have with customers, in particular the agreed Direct Debit payment dates. This failure is a reminder to suppliers that when making changes to their systems, they need to undertake appropriate checks to avoid any unintended consequences for customers.”

Customers shoudl contact E.On to make a claim for any bank charges or other detriment caused by the early direct debit payments.