“Confusing” Tariffs- How millions are paying for handsets they already own
Four million smartphone users are being charged for handsets they already own, a consumer group has revealed.
According to a report by Citizens Advice, they are paying £490 million over the odds as networks carry on taking payments for devices despite contracts ending.
The probe has named EE, Three and Vodafone as the networks which “routinely charge customers extra for their handsets after they have been paid off”. When contracts expire – usually after 24 months – smartphone users own the device and should only pay for calls, texts and data. But Citizens Advice said millions do not realise this as they are caught out by confusing bundles that do not spell out the cost of the handset as well as the service they are getting.
Its analysis of 700 different bundled contracts found in almost three quarters of cases, consumers would have bought the smartphone at the end of the deal.
Yet one in three sailed past their minimum contract period with no idea they had carried on paying for a handset they already owned.
On average, those failing to upgrade or switch paid up to £38 a month extra for an iPhone 7 or Samsung Galaxy and £22 for other brands.
The consumer group is now calling on the networks to make prices of service and phones more transparent by separating the costs so customers can see at a glance how the bill is broken down.
Regulator Ofcom is consulting on the matter and has said providers should send customers a reminder before their contract ends so they can plan ahead.
Citizens Advice chief executive Gillian Guy said: “It is unacceptable that mobile providers are knowingly overcharging customers for phones they already own.
“We’ve heard a lot of talk from Government and the regulator but now we need action. Other companies have already stopped doing this so we’re looking for these three major providers to follow suit.
“In the meantime, consumers should check their phone bills to see if they can save money with a SIM-only contract or upgrade to a new phone.”
Yesterday, EE, Three and Vodafone hit back and said all contract customers were given advance warning or made aware of when contracts ended.
EE said it sent out several reminders with a countdown from 90 days to 30 days with most customers upgrading or switching to SIM-only deals in advance of their contract ending.
In a statement EE said: “We provide our customers with some of the clearest information in the UK with a series of alerts before the end of their contract that explain their options including early upgrades, upgrades at the end of their contract or a wide range of SIM only options.
“We fully agree that customers shouldn’t overpay, but we believe that this is best achieved through clear communications with consumers about their options, and that the current proposals for separating phones and tariff is overly simplistic and doesn’t give the customers either the transparency or best deal that they deserve.”
Vodafone said: “We already contact all of our customers when they are approaching the end of their minimum term to let them know their options. These include upgrading their handset or moving to a SIM-only contract so they are not paying anything for a handset.
“From next month, we will also be giving extra data to those customers who don’t opt for either of these options but instead choose to stay on their contract after the end of their minimum term.”
And Three said: “We make the length of any contract very clear to new customers and make this information available through our customer service channels at all times.
“We continue to look closely at the issue of handset financing and are working closely on this with the government and regulators. We are investigating how we can extend the type of tariffs that we offer that will improve choice for our customers.”
News source: The Mirror
