An energy supplier with customers across East Anglia has vowed to improve after being slapped with a ban on taking on new clients by the regulator.

Economy Energy has been warned their customer service is not up to scratch by Ofgem and told they could have their licence revoked.

A spokesman for the firm said: "In light of the news received from Ofgem, in which we are very disappointed, we wish to advise our customers we will be cooperating fully with Ofgem and are always committed to continual improvement of our business. We thank our customers for their support."

The ban will remain in place for up to three months in order for Economy Energy to "take steps to improve and expand" its customer contact procedures via email and webchat, address its billing and payment failures and issue customer refunds in a timely manner.

The Coventry-based supplier, which has around 244,000 customers, is also thought to be in financial distress and is working with KPMG to assess its options.

The regulator said the small energy supplier has also been ordered to stop requesting one-off payments and increasing direct debits.

If Economy Energy fails to make improvements within three months, Ofgem can confirm the provisional order to extend the ban or, if the supplier fails to improve, it can take steps to revoke its licence.

Ofgem said it has taken action due to the decline in the standards of Economy Energy's customer service, complaints handling processes and billing and payment procedures.

Several small providers have gone bust recently, including Spark Energy, Extra Energy, Future Energy, National Gas and Power, Iresa Energy, Gen4U, One Select and Usio Energy.

Anthony Pygram, director of conduct and enforcement, said: "Ofgem is taking action to protect customers from suffering more harm from the unacceptable level of customer service provided by Economy Energy. We expect the supplier to take immediate action to rectify its failings or face having its ban extended.

"All suppliers are required to treat their customers fairly. Where they do not, Ofgem will take the necessary steps to ensure suppliers change their behaviour and to prevent further harm to customers."