Payments

What is the poverty premium in payments?

Everyday millions of payments are made in the UK, from online transactions to cash in shops. They are an essential part of life today.

However, some payment methods create a poverty premium, meaning people are charged more for the way they spend their own money.

Some people do not have bank accounts so have no access to direct debits, which tend to be a cheaper way to pay for bills. Others are charged to use fee-charging ATMs because they use cash to budget on a tight income. Others are charged more for paying for things like insurance each month rather than all in one go for the year.

What we're doing

We are undertaking research to understand the demand for more flexible ways for people to pay their energy and other bills. We are also working with the Payment Systems Regulator (OSR) and Ofgem to look at whether suppliers could offer customers more flexibility in the way they pay their energy bills.

We are working with the Payment Systems Regulator (PSR) and Ofgem to tell suppliers to introduce more flexible ways to pay bills that work for those on low incomes. 

Read our paper on payments

News And Publications - payments

Find all our our evidence, reports and consultation findings

We launch our new payments film

Date published: 08/04/24

Watch the stories of Catherine, Zahada and Caroline, who all pay more because of the…

A plan to tackle the poverty premium and make markets work

Date published: 27/03/24

Read our report with Fabian Society on how the next government can reduce the poverty…

We respond to Treasury’s future of payments review

Date published: 01/08/23

People on low incomes pay a poverty premium because of the way they are able…

Payments systems and the poverty premium

Date published: 08/05/23

Read our report on the challenges faced by people on low-incomes when they pay for…

People with certain protected characteristics more likely to pay a poverty premium

Date published: 23/02/21

People on low incomes and with certain protected characteristics are more likely to be paying…

The poverty premium: a customer perspective

Date published: 23/11/20

Read Fair By Design’s report which found that low income households were spending the equivalent…

We consult on Payment Systems Regulator’s future strategy work

Date published: 29/07/20

The Payment Systems Regulator (PSR) has launched its future strategy work.The aim is to start…

Paying to be Poor

Date published: 17/08/19

Read the University of Bristol’s seminal report looking at the scale and nature of the…

Explore all news & publications

Real Stories

Our work is led by the voices of those who experience the poverty premium.

More real stories

We launch our new payments film

Date published: 08/04/24

Watch the stories of Catherine, Zahada and Caroline, who all pay more because of the…