British Gas has paid 1.48 million pounds to impacted customers and will pay an additional 250,000 pounds into an energy redress fund, which supports consumers in vulnerable situations.
Following these measures, Ofgem has decided not to take formal enforcement action.
With a prepayment meter, customers pay in advance for their energy supply by topping up their credit on a card or key at certain shops.
British Gas failed to notify around 270,000 pre-payment customers about a change of top-up provider, from Paypoint to Payzone, which happened on Jan. 1 this year, Ofgem said.
Some customers might have wasted journeys to top up their meters at shops that no longer offered the service and in some cases did not have power supply, Ofgem said.
British Gas sent communications to these customers about the change in provider in late January.
Although British Gas informed most of its customers of the change in top-up provider in Dec. 2019, there was insufficient time for customers to switch energy supplier if they did not like the change.
The communication also did not include telephone contact details, but instead contained links to the internet, which meant those without internet access could have struggled to contact the company.
Britiah Gas also did not operate its general enquiries call line on Jan. 1 when the change took effect, Ofgem said.
(Reporting by Nina Chestney and Pushkala Aripaka in Bengaluru; editing by Barbara Lewis)