Electricity contract with a bad credit record
Electricity is considered an essential commodity in Finland, so losing your credit information does not prevent you from getting an electricity contract either. We listed the best electricity contracts as well as tips for purchasing an electricity contract even if you find a non-payment notice.
Bad credit record - Where to find an electricity contract?
When you search for an electricity contract for someone with no credit report, you can find the best offers in our list to make your comparison process easier.
Electricity contract without credit information - comparing is worthwhile, paying too much is not
Lack of credit score is not particularly rare - for example, in 2022 in Finland there were 388 600 people without a credit score. Thanks to the new law change, however, the number is on the way down. In 2022, payment difficulties were caused in particular by increased electricity bills, which is why it is really worth comparing electricity contracts.
Whatever the reason for the loss of credit information, it is possible to get an electricity contract even without credit information. However, it is not always unequivocally easy.
Electricity contract for people with no credit report in practice
The electricity contract is therefore also possible without credit information. However, it is not necessarily always easy, and the procedures often differ between different electricity companies.
Although electricity companies in principle also have the option to refuse to sell electricity to a consumer with a payment default label, this does not apply to the local electricity company's so-called delivery obligation product. However, this does not mean that you will get an electricity contract just like that: security payments are quite a common practice in the industry.
Electricity contracts valid for the time being are a good choice for people with no credit report.
Collateral is often requested - although not always on legal grounds
According to the statement of Jukka Kaakkola, a lawyer at the Finnish Competition and Consumer Agency interviewed by Yleisradio, the electricity companies require guarantees on too flimsy grounds.
In 2019, Yleisradio asked a total of 68 companies selling electricity and 52 companies specializing in electricity transmission about security payments requested from consumers with no credit history. Although not all companies responded to the survey, the final result for those who responded was as follows: a quarter of the transmission companies and a third of the companies selling electricity required their uncredited (potential) customers to pay a security deposit in advance when the consumer was found to have a non-payment record or if it was a new customer.
The Finnish Competition and Consumer Authority has interpreted deposit payments in such a way that electricity companies can request a deposit from the consumer if there is a "very compelling reason". You should therefore contact the electricity company or, if necessary, the consumer authority if the security deposit seems unreasonable.
How much is the security requested by the electricity company?
This is very individual and the biggest factor is generally considered to be the type of living.
If it is, for example, a single-family house with electric heating, it can be relatively easy to get an electricity contract for someone with no credit report, but in this case the consumer should still be prepared for a security deposit of up to thousands of euros in the worst case.
On the other hand, a consumer with no credit who lives in a small apartment building can get by with hundreds.
Can electricity be supplied to the apartment before the security deposit has been paid?
If a security deposit has been requested, the practice for connecting the electricity varies by electricity company. About 40 percent of the companies that sell electricity and 60 percent of the transmission companies that responded to Yleisradio's survey require payment of a security deposit in their name before turning on the electricity at the place of electricity order.
Comparing electricity contracts is part of financial management - and it pays off!
Although an electricity contract for someone with no credit report can often mean a security deposit, it is still worth tendering the electricity contract itself and use the saved euros to, for example, take care of default debts.
With the new change in the law, payment default entries will be removed as soon as they have been acknowledged.
Electricity companies are not the only ones – other companies can also ask for collateral
Electricity companies are by no means the only companies that can request a security deposit from consumers who have received a notice of payment failure. Security payments have indeed become a fairly common operating model for telecom operators and insurance companies, for example.
You should seek help for debt problems - and there is help available!
However, overcoming debt problems is often a bigger project and comparing electricity contracts is only a small part of the bigger picture.
If you yourself are having financial problems, we recommend that you visit, for example, the Ulosottolaitos website, which contains several useful tips and links to balance your personal financial situation.
Saving is always worthwhile, but especially when debts are already burdening the economy. Electricity contracts without a fixed fee can be a good solution in this case.