This article originally appeared in ISO Focus magazine, written by Bill Dee – Convenor of the ISO/COPOLCO, Danny Ilan – Secretary of ISO/TC 239, and Neil Avery – consumer and public interest representative with the British Standards Institution and Editor of ISO 14452.
How many times have you found your bills confusing, overloaded or simply inaccurate? Have you ever had problems paying, or been unclear about how to switch suppliers? Billing problems are a major cause of complaints made to utilities and utility industry ombudsmen. While the market has never fully addressed this failure itself, a new International Standard – ISO 14452, Network services billing – promises to make billing clearer, more customer friendly and better all round.
Against a background of market failure to resolve ongoing billing issues, and following
related surveys, the ISO Committee on consumer policy (ISO/COPOLCO)
stepped in. ISO/COPOLCO’s working group on consumer protection in the global marketplace highlighted a need for an International Standard on this critical consumer matter.
ISO 14452 aims to provide a market based, market sensitive way of dealing with
customer concerns about billing. The problem Customers often experience problems
such as :
• Bill shock
• Bills that are complicated, overloaded with information and confusing
• Unclear pricing
• Inaccurate bills
• Difficulties with payment methods
• Unclear information on offers and how to switch suppliers.
Billing problems occur for many reasons.
These include :
• Poor pre-billing processes, for example in customer service, tariff and
data management, meter reading and informing customers about billing
• Unsatisfactory billing procedures and practices, leading to delayed or inaccurate bills
• Poorly presented, unclear bills and statements
• Ineffective post-billing processes to deal with disputes and inquiries, payment
and debt collection, vulnerable consumers and final bills for customers changing supplier
• Inappropriate customer expectations, based on confusing advertising or promotional materials, and on complicated tariffs.
Clearer bills help customers verify the accuracy of charges and make them more
confident about their bills and their supplier’s performance. In competitive markets, this
also helps customers to choose the best and most suitable supplier.
Utilities benefit from ISO 14452 too – for a start, they should receive fewer
complaints. This will reduce their operating costs, improve debt recovery, and increase
customer satisfaction and loyalty. In addition, by using a common International
Standard and billing practices, multinational utility companies can reduce their costs.
ISO 14452 helps utilities ensure that they provide their customers with clearly
comprehensible, accurate, timely and complete bills, giving them enough information
to verify their charges. In this respect the standard :
• Defines the minimum requirements for billing and payment collection
• Prevents or reduces complaints by tackling key issues
• Ensures that suppliers assist customers by billing appropriately and
• Creates and sustains a fairer, longer term supplier-customer relationship
• Provides benchmarks for customer expectations
• Allows for the implementation of smart metering technology and the provision of improved customer information
• Facilitates innovation in billing, enabling suppliers to differentiate their services.
ISO 14452 is aimed at utility bills which include an element of metered or measured
consumption. However, many of its key principles apply to all forms of billing and
the standard states that suppliers should adopt its requirements even if usage is not
metered or otherwise measured. Regional or national factors may require the standard to be adapted to meet prevailing cultural, social, economic, regulatory and even climatic conditions.
ISO 14452’s scope specifies minimum billing requirements for all consumptionbased
utility network services to domestic customers. This includes the processes
required to produce the bill and address any issues after it has been sent out. It also
provides guidelines for the content of the billing document or statement.
The standard applies to services which are unmetered, metered at the point of delivery,
or metered remotely (for example at the supplier’s own premises). It covers any
unmetered or unmeasured charges appearing on the same bill as metered or measured
charges, as well as flat-rate charges. The standard does not cover pricing, except as a requirement to provide information to customers. It applies only to billing for consumption-based utility network services, and to all bills or statements for such services in which there is an ongoing supplier-customer account relationship, regardless of the payment method used.
The scope of the standard includes : bills for metered consumption ; bills where a
formula is used to estimate consumption (for example, water bills based on the
number of persons per household or the size of the house) ; and flat fees charged
regardless of consumption (for example, telephony or internet bills where the tariff
allows unlimited usage).
It also applies to pre-payment customers where a supplier bill or account is needed for
in advance with the cost of consumption; or where the customer expects to receive a bill
based on point of sale or other advertising (for example, mobile telephony and energy
metering) in which codes, keys, electronic dongles or electronic cards are used to load
and reload the service and to indicate what was purchased.
The standard does not cover unbilled services (mobile telephony paid for by prepurchased
SIM cards that are unmetered, for example) and unbilled services funded directly by the taxpayer.
Putting customers first
The standard recognizes that effective policies and procedures are needed to
identify and then manage the needs of vulnerable customers. Procedures include
detailed guidance to help staff to identify vulnerable customers and ensure that
specialist support is provided when a customer cannot understand advice given or
take the necessary action.
Processes exist to ensure that customers can contact their supplier easily, make
complaints and obtain appropriate redress where necessary. In competitive utility markets it is also important that customers can easily end the contract and/or switch suppliers. The standard ensures there are no unnecessary barriers to switching and that transfers are completed within agreed timescales.
Finally, ISO 14452 also stipulates that compliance and continual improvement systems need to be developed and implemented. This is to ensure that billing procedures are regularly reviewed and updated to reflect customer feedback and external best practice.