Ofgem says the company failed to notify approximately 270,000 customers for the change of the provider, which went live on 1st January.
Because of that, some customers might have wasted journeys to top up their meters at shops that no longer offered the service.
The regulator notes British Gas informed most of its customers of the change in top-up provider in December 2019, not allowing sufficient time for customers to switch supplier if they did not like the change.
Ofgem adds the notification did not include telephone contact details but instead contained links to the internet, which meant those unfamiliar or without access to the internet could have struggled to contact the company.
Additionally, British Gas chose not to operate its general enquiries line on 1st January, the go-live date, according to Ofgem.
Philippa Pickford, Director of Retail at Ofgem said: “When such a fundamental change is being made, such as where meters can be topped up, energy suppliers need to communicate with their customers in plenty of time. British Gas should have informed all of their prepayment customers, many of whom are in vulnerable situations, of the change to how to top-up their meters during the winter period.”
A British Gas spokesperson said: “We chose to move our prepayment top up service to Payzone as we believe they offer the best and most flexible service for our customers and will add more outlets where our customers need them. We recognise that this transition was not as smooth as it should have been and we would like to apologise again to any customer impacted.
“We respect Ofgem’s decision and will be paying an additional £250,000 to the Voluntary Redress fund. We have already paid £1.48 million in compensation to our prepayment customers who were negatively impacted by this change.
“We know that some prepayment customers are vulnerable and we take our responsibilities to them very seriously. We ensured that anyone who contacted us had heating and hot water – this included sending an engineer to manually add credit to the meter if the customer was unable to get to their nearest working top up point.”