Challenging Environment May Offer Opportunities to Expand Prepay

Even before COVID-19 changed the playing field for billing, payments and arrears, many utilities were exploring the idea of offering some kind of prepay option to their customers. Since 2020, the potential benefits of prepay have only grown for both utilities and customers. In this report, Chartwell explores the challenges and benefits of offering prepay services.

Key Takeaways
  • Utilities add prepay to their offerings for several reasons:
    * To better serve low-income or no-credit/bad-credit customers.
    * To encourage greater energy efficiency.
    * To decrease call volume and disconnects regardless of income.
  • While prepay programs offer fewer barriers to disconnection, there are in effect no barriers to reconnecting service.
  • Prepay programs prevent customers from accumulating high balances that can impact their finances as well as their credit, while also decreasing utility arrears.
  • Prepay arrangements allow customers to pay down debt at their own pace instead of trying (and often failing) to meet a disconnect deadline, and do so while having power available to them.
  • Being able to offer a prepay alternative with low financial barriers to entry contributes to increased CSR satisfaction.


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arrears Billing and Payment low income payment prepay