Suppliers warned not to use ‘threatening tones’ to recover debt

Energy suppliers have been warned not to use threatening tones in communications with their customers over debt, following research showing this may be counterproductive.

The research by Ofgem was published alongside its latest Consumer Protection Report which raised concerns some suppliers were prematurely or even incorrectly involving debt collection agencies.

The regulator said in one case a supplier issued a county court judgement to a consumer over a small amount of debt, despite not having sent them a bill.

A small number of energy suppliers, Ofgem said, use a “disproportionately strong or threatening tone” in communications with customers during the debt recovery process. This, it added, is not conducive to increasing customer engagement and is instead more likely to cause a “negative emotional impact”.

Accompanying the report were the results from a two-phase project which analysed customer behaviour in relation to various debt-related communications. The first phase involved qualitative research with 30 energy customers, while the second phase involved 1,500 participants in an online behavioural experiment.

It found that energy debt communications which participants described as being harsher in tone do not increase their intentions to engage and may even reduce engagement when compared to ‘friendlier’ communications.

Furthermore, harsh communications reduced objective comprehension of key information and were less likely to be read in full.

Ofgem said that in order for a supplier to meet the regulator’s core outcomes for effective debt communication, it is not enough for retailers to issue communications in a way that simply maximises the likelihood of customer engagement by any means.

“Rather this must be achieved in a way that is respectful of a customer’s perceptions of the emotional and practical consequences of engagement, and their understanding of supplier obligations,” it added.