20 million people losing money on mobile, phone and broadband contracts – for one simple reason
Providers rarely tell customers when their contract is nearly up as it often means more cash in their pockets – but all that is about to change
Busy lives and small print do not mix well. So it is easy to forget where you are with your telly, mobile and broadband contracts.
Regulator Ofcom says that most consumers do not have a clue when their contract ends or what happens next.
It suspects more than 20 million people are out of their minimum contract period. And if you are one of them, it could be costing you.
When deals end
Providers rarely tell customers their contract is nearly up. That is because most have a provision where there is an automatic price increase when it ends.
For instance, Ofcom says that customers with a landline and broadband deal typically pay 20per cent more after their contract ends.
Consumers with mobile phone contracts can also suffer greatly.
A reader called Harrison, from Southend in Essex, told me that when his mobile contract ended in February the provider continued to charge him for his handset.
He was furious as he had already paid this off during the initial contract period. He then found out he could have avoided it if he had switched to a sim-only deal.
Steps you can take
The first step to take is to find out if your contract has come to an end and, if it has not, to note when it does. You should then shop around to see if there is a better deal on the market.
If there is, you can ask your supplier if they can match it. By doing this, you will almost certainly save yourself a heap of money.
New Ofcom rules
Ofcom has proposed new rules this week to combat this increasing issue faced by consumers.
Under these new rules, UK providers will have an obligation to alert their customers when they are nearing the end of their contracts. They will also have an obligation to inform customers how much they could save by switching providers.
While this is great news for consumers, I am not getting excited yet because it is still a proposal. There could be a long way to go.
Let us hope the proposal is turned into a concrete rule and that it is implemented soon.
Meanwhile, make a diary note of your contract expiry dates – and start shopping around.
News source: Dean Dunham, Sunday Mirror