Ofgem’s proposal to protect microbusinesses.
The final proposal set by Ofgem has been sealed in the aim to protect microbusinesses throughout the UK from brokers who don’t stay in line.
Energy brokers are still active in the UK to help customers compare energy and utility deals and ensure they find the most suited package for their business sector. The proposal suggests their is a small portion of brokers who ‘engage in poor practices with opaque fees for brokerage services’
In one report which was assessed, a bill of £24,000 in commission fees was delivered to a business which made up roughly half of the total contract price. However the customer was not made aware of this prior to signing the contract.
The new provision, set to take force in 2021, aims to ensure broker commissions are made more obvious and accesible to customers.
Any dissagreements that arise in new deals will also be able to be resolved via an independant service, with the introduction of a 14 day cooling-off period.
You can expect these measures to be put in action later this year.
Ofgem’s Interim Director of Retail Anna Rossington said: “With the impacts of the pandemic still being felt by many microbusinesses, it’s even more important to listen to the challenges these customers are facing in shopping around for their energy.
“Ofgem’s proposals will crack down on poor practice and empower microbusiness customers by making it easier for them to get a better deal. We are also sending out a clear signal to industry about the high standards we expect.”
Ofgem’s proposal to protect microbusinesses