The National Consumer Agency has said customers of the Home Payments company are unlikely to see their savings again.
The NCA says up to 20,000 people could have been affected after the household budgeting service ceased trading on Tuesday.
It is due to meet with industry regulators next week to try to help those affected by the closure of the debt management company.
NCA chief executive Ann Fitzgerald said the agency will be trying to ensure people who have paid Home Payments for bills such as mortgages, electricity and insurance do not have to pay twice.
Homes Payments Limited, which has been operating since 1963, blamed declining values on investments in the property sector for its closure.
In a new statement, the company apologised for the lack of information and the stress caused to its customers.
It said the decision to cease trading late on Tuesday afternoon was unexpected and that it had stopped taking payments such as cheques and direct debits immediately.
But the National Consumer Agency say all direct debits to this company should still be cancelled and that people using similar services should consider stopping.
It is also calling for measures to regulate the industry to be introduced as a matter of urgency.