I saw that Choice criticized DEFERIT - this is a Bill payment lifesaver for me

A few years ago I discovered Deferit. A site which lets you upload a bill (usually utility) to pay in 4 instalments (every 2 weeks).
This was a lifesaver for me as everytime I received a utility bill I had to juggle my money (or borrow from my loan account). I am a pensioner.
Bills had me extremely stressed and some bills I received around the same time to make things worse. Going down the Hardship road through utilities also stressed me out.
The past few years have been so good. No stress when a bill comes in. I upload it to Deferit and choose the date I want payment made - always on a Pension day. They pay the whole bill and I repay in fortnightly instalments. Monthly fee is $9.99 and if I have 2 or 3 bills on the go - it’s only $9.99 for the lot (not $9.99 for each bill).
Please do not criticise my “saviour”.

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Hi @Kezia,

Thanks for the feedback. I think you might be referring to the below article.

In this case, what we are saying is that there are better options that won’t cost you an extra $10 a month. According to Julia Davis, senior policy officer for the Financial Rights Legal Centre, you would be better speaking to your energy provider as they are required to give you assistance under hardship grounds.

“If you don’t tell them you’re in hardship, if you instead use some third-party payment system like Deferit, then you’re missing out on a lot of assistance that you are legally entitled to,” she says.

Hopefully that puts back in your pocket!

Here is the article for reference:

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Friends of mine have arrangements with their utility companies to pay monthly, its much easier to do that. I just pay when the bills come in… have an app that helps me stay on track so I am never short. Might be on short rations for a while but never too long.

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Hi Sue, I also have a friend who made arrangements with their utility companies. I’m not interested in “monthly payments”. I have these monthly payments for house insurance, etc. and they don’t coincide with my Pension days. I prefer fortnightly payments on my Pension day. Having all these instalments on one site is easier for me than dealing with individual utility companies.

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‘Criticism’ (being described as what it is) is appropriate when a company performs a service for a price when a consumer can do it themselves for free or there are not-for-profits and public interest options at $0 cost.

That being written it is correct that not every consumer is equipped to do it themselves, and they are willing to pay for a convenience or an ‘enforced’ solution they might not be able to accomplish on their own, or they are not equipped/interested to seek the other options out.

As you wrote, one ‘size’ does fit fit all but at the end of a year there are differences in one’s accounts as a result of their choices.

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PhilT,
I understand that using the word “criticism” is harsh, but Choice did not acknowledge
that some people prefer Deferit and don’t wish to go down other avenues for $0 fees.
It was a one-sided article. I would be very suprised if pensioners are using Deferit because they have no knowledge of hardship & instalment plans by utilities etc.
They are using it for ease & convenience.

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This is exactly why Deferit deserves criticism. They target a vulnerable group of consumers with a line of credit, bypassing safe lending laws, when free help is available if you know how. If people are using Deferit for convenience, this is equally concerning. Many people probably do not realise that this convenience can affect your credit score if you take credit frequently or pay late. This should be especially concerning for older Australians who already face a challenge getting finance.

At the end of the day I struggle to understand how it’s more convenient or easy than simply setting up an automatic transfer to a bank account for your utilities, completely for free with no credit needed.

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This pensioner would rather have that $10/m in her account than pay it to a third party. I review my bills every year, and work out exactly what the previous year has cost me (OUCH in some cases). then how much I need to set aside on pension day, for bills. It works out pretty well and I have only been on short rations at times I have overspent on other things (thus diving into the bills account). Currently I cant overspend because I just don’t have the dosh, thanks to general cost increases.

I have an app on my phone and also on my Mac desktop which, once bills are plugged in with the right info (how much, how often, and a way to show paid and how much) and it has kept me on track since 2011, which is when I went on the pension. I knew I had to do something constructive because when I was working I simply spent what I had, and relied on luck instead of good management when the bills came in. I’ve surprised myself by managing better now than I ever did as a worker.

I’m rambling. sorry :slight_smile:

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For balance and without comment, from Deferit - essentially a FAQ page

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All good policies to have. I hope they live up to them.

Unfortunately, without regulation it is very difficult to know if they are. Afterpay famously boasted about how little of its income came from late payment charges. Does that mean I trust their behaviour when people pay late? Not a change.

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thank you for sharing your experience. My mum is a pensioner who has remarked more often (than usual) lately about bills. She may like your app, if you would share it?

Hello Kim0,
I don’t have an “App”. I go to Pay Bills Now Pay Later | Deferit
You need to register.
Then I scan my bill/bills and upload to desktop. Initially I did a PDF enlargement of BPay details, as deferit error message would often come back that they could not read the details.
Now I don’t need to as deferit has been paying my same bills for a couple of years now and they seem to automatically know BPay details. Originally I had about $400 limit which they gradually increased. Now my limit is $1,200. I have electricity, council rates, water rates, car insurance, RACV. My house insurance is too high for fortnightly payments. I believe they may pay other bills of reliable clients, maybe vet, dental but I’m not sure. They originally had contact by phone, but now it’s “Chat” on site which is ok.

As a general comment I just don’t get it. After a full billing cycle of all the bills you have put up the total cost to you will be exactly the same as if you had paid the bills on time. Except Deferit have also collected 3 monthly payments for their service, ($30 round numbers).

There may be a minor initial benefit in stalling paying a large bill or two in full up front, but there after? One might as well put a fixed amount each week aside equal to 1/12 of the previous 3 months of bills. Most utilities and similar bills are issued up to 28 days in advance. By the time the first bill is at its due date how close will the amount put in the jar or what ever place it’s set aside be adequate to meet your needs.

There’s a discipline required. Which is just as important whether one chooses to have Deferit take your money every 2 weeks plus $10 per month, or you put a fixed amount aside each 2 weeks. At the end of each 13 week cycle the total cost will be less without Deferit than with. Perhaps it’s that some do not see how Deferit gets others to believe it’s a benefit.

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This seems to me to be like a BNPL business, you buy the goods on credit and pay it off over a period and there is an added monthly charge to do so.

Like @mark_m has noted, it would be much cheaper in the long run to set aside the needed funds to meet future bills each time a payment is received. So if a bill is expected to be every quarter, then divide the anticipated bill by the number of payments received in that time and set that amount aside each pay. If it is a higher bill than expected then most utilities will provide a means for a person to pay the remainder with a payment plan. In some situations the extra can be wiped and for the future expenses be put on a payment plan that ensures that a customer is paying a regular amount each payday to cover the bills.

In Qld, for vehicle registration there is a way to spread the cost of registration over a period such that the bill when it arrives is partly or wholly offset by the amounts paid in (dependent on the amount a person has contributed prior to the renewal notice). This is a no extra fee plan.

Rates can be prepaid by paying a portion each payday, as can water. I know with Origin Energy electricity and gas accounts, there is a scheme called Easipay that breaks the yearly bill into equal payments throughput the year. If the costs change dramatically then the payment amount is altered to cater, but the supply of power is never at risk while the customer continues to adhere to the payment plan. This is a no extra fee plan. I am sure other providers of most of these services provide similar plans and assistance, in the energy provision sector it is mandated to be so.

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Hey @Kim0 … You mum will need to be in the apple ecosystem for this app. That said, if she has an iPhone, its available for that, too.
Its free. https://chronicleapp.com/

I actually started with this kind of app when I was using Windows, decades ago… it was called SimplyBudgets and it worked in much the same way, but I think they guy who was selling it has gone down a path I might not follow now. Nonetheless, I’ll leave a link here. Also, not free… its a subscription model now. https://simplybudgets.com.au/

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Thanks @SueW - My mum’s name is also Sue :slight_smile:

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After reading through some of the comments I’m astounded at the multiple suggestions of putting money aside each pay day- this would require discipline to not dip into that ‘extra money’, especially during hard times.
However, I have always found, especially with utilities, working out the average cost from past bill cycles and divide that amount into however many pay cycles between due dates/bill dates and setting up a direct debit each pay for that amount, I usually add $5-10 extra, so when I receive the bill I don’t have a huge payment due- I actually tend to be in credit with utilities.
There is no requirement to speak to anyone about hardship & there is no extra costs associated with paying like this.

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If someone is struggling with financial discipline and leaving no money left for bills, I’m not sure a credit product is the answer.

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My energy provider had an offer of $75/pa credit if we went to monthly payment and email bill. So we pay a set amount (reviewed 6 monthly) and receive a statement every quarter. The credit covers about a month & half per year.

Telstra had a plan for our landline which was approx $7 more than our variable plan. The $55 plan offered free calls, which took the pressure off my husband who worried about the cost of calls to mobiles and wished he could talk longer with his mates. It allowed me to set up a $55 monthly debit.

Set debits like this make life easier, and I can keep my business myself, and even save something by taking advantage of various deals or Plans on offer.

Pensioner friends of ours pay their Council rates monthly through CentreLink. They are in credit, but won’t change as they consider it a buffer against rising rates.

I used to help people with budgeting (as a volunteer for a not-for-profit). The saddest case I had was a young couple with 3 children who went with a Debt Consolidation company. The company took over all their debts & bills and charged them more interest and fees than they were paying, in return they had a monthly payment they couldn’t afford and were about to lose their house.

I understand if people want to pay a fee to have someone else manage their bills. That’s what Buy Now Pay Later schemes are about, but they have to make a profit, and you hope they will be ethical with your accounts.

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