ChatterBank2 mins ago
Ovo Energy Company. Pays 5% Interest. Worthwhile??
5 Answers
I have an excess of about £450.00 with Ovo, which I am leaving there as they pay 5% on it - better than I get anywhere else, and with winter coming up, my bills are going to be much higher.
Anyone see any disadvantages in this??
Anyone see any disadvantages in this??
Answers
As Gizmonster says, you need to think about whether you could get a cheaper energy deal elsewhere, not only now but in the future. If, say, Ovo were to start charging 10% more than the cheapest deal available elsewhere in a few years time, the money you'd already got in your account with them would effectively be of less value than if you were paying it to another...
16:03 Wed 05th Sep 2018
As Gizmonster says, you need to think about whether you could get a cheaper energy deal elsewhere, not only now but in the future. If, say, Ovo were to start charging 10% more than the cheapest deal available elsewhere in a few years time, the money you'd already got in your account with them would effectively be of less value than if you were paying it to another energy supplier.
There might also be concerns about whether your money was safe if Ovo was to go bust. (There's some discussion about such matters here: https:/ /forums .moneys avingex pert.co m/showt hread.p hp?t=57 12120 ).
Lastly, I'd be a little worried about whether HMRC will continue to go along with Ovo's claim that no tax is payable on the interest. If more and more people take up the scheme I wouldn't be at all surprised to see HMRC issuing back-dated tax demands to Ovo's customers.
There might also be concerns about whether your money was safe if Ovo was to go bust. (There's some discussion about such matters here: https:/
Lastly, I'd be a little worried about whether HMRC will continue to go along with Ovo's claim that no tax is payable on the interest. If more and more people take up the scheme I wouldn't be at all surprised to see HMRC issuing back-dated tax demands to Ovo's customers.
^^^ There's no limit in Ovo's T&Cs, Ladybirder, but some energy companies automatically refund some or all of excessively large credit balances, meaning that (if they chose to do so) Ovo could simply send a customer a cheque if their credit balance got ridiculously large, thus effectively limiting the amount that they could earn interest on.
https:/ /www.ov oenergy .com/he lp/inte rest-re ward
https:/
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