Three Mobile customers face loyalty penalty, says Citizens Advice

News, Smartphones

Three Mobile customers who are being penalised for their loyalty will continue to be overcharged by between £1.5 million and £2.7 million a month, Citizens Advice has said.

In July, Ofcom announced commitments from some of the UK’s biggest mobile companies to apply discounts to out-of-contract customers’ bills as it announced proposals to ban firms from tying customers into “excessively long” split contracts which link together their handset and their airtime for periods of more than two years.

However, the regulator said Three had “refused” to apply a discount to its out-of-contract customers.

The measures are due to come into effect by February.

Citizens Advice has long campaigned to end the “loyalty penalty” – the difference in tariffs paid by existing customers and new customers for the same service.

In the mobile sector, this is because customers continue to be charged for the handset at the end of a minimum contract period when they have already paid it off.

Citizens Advice said that according to publicly available data, between 154,000 and 210,000 Three customers are paying a loyalty penalty at an average £10 to £13 a month.

Citizens Advice chief executive Gillian Guy said: “It’s unacceptable that Three still thinks it can penalise its loyal customers by over a million pounds every month. It cannot continue to bury its head in the sand.

“We’re pleased other mobile providers have said they’re going to act, but they must now follow through on their promises and put them into effect by early next year.

“All eyes will be on Three to see if it puts this right and agrees to stamp out the loyalty penalty.”

A Three spokeswoman said: “The current proposals are not in customers’ best interests. Applying an arbitrary discount to tariffs will not effectively tackle what really matters – helping them to find a contract which is both best-suited to their needs and priced fairly.

“As the leading campaigner for easy switching for the mobile industry, we are working hard to create a market where customers are engaged and happy, by pushing for easier switching, all handsets to be unlocked, end-of-contract notifications and best tariff advice.”

Chris Price
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