Elderly people are paying more for basic goods and services because they are less likely to use the internet.
They suffer twice over because they find it harder to shop around for the best deals while some retailers simply offer cheaper prices online, new research shows.
Products and services ranging from food, rail tickets and insurance can be bought cheaper online than in person or over the telephone, according to a study by think tank the Centre for Social Justice.
Home insurance can cost £18.46 more when purchased offline, while a SIM only phone contract can cost £192 more.
But research by the think tank found 11 percent of households, around 3.1 million, cannot access the internet at home.
This is significantly higher than the previous estimates which put the figure at two million households.
Most people without internet access are over the age of 65 and 29 percent are of working age.
They have been hit even harder by the cost of living crisis. But some households struggling with increased energy and food bills have also cancelled broadband contracts in a bid to save money, making the problem worse.
Matthew Greenwood, Head of Debt at the Centre for Social Justice, said: “In our new analysis of digital exclusion, it becomes clear that millions of households still lack access to the internet at home.”
“This inconsistent access dampens their economic outcomes and can lead them to paying a poverty premium for basic goods and services, such as food and insurance.”
The report, produced in partnership with Virgin Money, calls on the Government to cut VAT on deals known as social tariffs offered by internet firms to low-income households, and to ensure that these services offer the same speed as regular internet services.
It also calls for a new digital skills programme, targeted at those who are unemployed and those with limited digital skills
The report warns: “Without the internet, consumers are more likely to pay higher prices. Our research shows that consumers could pay 25 percent more for an illustrative series of transactions, including for insurance, phone contracts, and food.”
David Duffy, CEO at Virgin Money, said: “We are proud to have worked with the Centre for Social Justice to develop this report and highlight the significant detriment those experiencing digital exclusion are facing. Digital exclusion and the poverty premium are issues that cannot be tackled by a few organisations alone.”