ABC 24 Story About Customer Credit Ratings and Policies

ABC 24's Jeni Diprizio interviewed MLGW President and CEO Jerry Collins Jr. about MLGW's customer credit ratings (A & B rated customers) and policies. (You can read it here.) There a number of points that Mr. Collins made that were not included in the story:

• Credit rating is associated with the level of risk and customers with lower credit ratings are considered a higher risk to fail to pay their bills in a timely fashion.

• Customers designated as “B” customers are those identified as having a low credit rating - being cut off for non-payment recently would be cause for the customer to be designated as a “B” customer.

• The customers with a good credit rating are given more time because they have a strong payment history and credit rating, and a much, much lower average outstanding balance than a customer with a poor credit rating.

• Good pay customers typically pay on time every month, very seldom runs up a big bill and can actually earn a late fee allowance that lets them pay late one month without any penalty. In this way, MLGW encourages customers to establish and maintain a good payment history.

• We have probably the most lenient credit policy in the industry. Most other utilities are much quicker to cut customers off.

• MLGW does not cut off (for non-payment) customers who owe $199 or less. In many other cities, customers can get cut off even if they owe as little as $25, $40, or $50.

• If you keep your balance less than $199 you will never be cut off for non-payment (there could be exceptions in situations such as theft).

• The good credit policy doesn’t apply to everyone because not everyone pays their bill in the same way. Some people have great pay habits and some people have very poor pay habits.

• The goal is not to bring in late fees, the goal just to have people pay their bill on time because it represents a cash flow problem if they don’t since MLGW must pay TVA for all power used.

• Our system for sending out cutoff notices, or cutting people off does not take into account what zip code that you live in.

• In every zip code, every customer within the zip code lives by the same credit policy and is subject to the same cutoff and payment requirements as any other customer in another zip code.

• MLGW offers many, many different programs and services to assist customers struggling to pay their bills.