Out-of-contract mobile customers overpaying, claims Which?
Which? is urging mobile phone users to take action when their contract comes to an end, with new research revealing those who push for a better deal could save up to £96 a year.
The consumer watchdog surveyed more than 4,000 members of the public in October 2020 to establish how mobile customers behaved when their contracts came to end.
According to the rules introduced by Ofcom in February last year, telecoms providers, including mobile providers, must issue end-of-contract notifications (ECNs) warning customers their contract is about to end to help them avoid eye-watering price hikes and encourage them to shop around for a better deal.
Which? found mobile users were most likely to do nothing (13%) when they received an ECN compared to other telecoms customers (9%) – putting them at risk of overpaying on their bill.
Out-of-contract customers can quickly find their tariff is poor value and in some cases – such as with EE, Three and Vodafone – customers may end up being significantly overcharged at the end of a contract or continue to pay for a handset that has already been paid off.
Around a third of mobile customers either haggled for a better deal (33%) or switched providers (35%) when their contract ended, saving an average of £60 a year on their bills. However, Which? found some customers who negotiated with their provider saved up to £96 a year.
Mobile providers are also required to inform customers of the best deals they have available in end-of-contract notifications. A fifth of mobile phone customers (20%) accepted the deal offered in their notification – protecting themselves from the worst price increases.
However, those who haggled or switched were more likely to get better deals for a similar price, for example with additional data or minutes. This is also a good opportunity for customers to ensure they are choosing the right tariff – and not overpaying for unused data.
Of those who haggled with their provider, seven in 10 (70%) said they were offered an upgraded deal, which meant more data or minutes on their plan. This is compared to just over half (55%) who were offered an upgraded deal in their end of contract notification.
Around four in 10 (44%) mobile customers who switched after receiving an end of contract notification said they did so because they had found a better deal elsewhere, and a quarter (23%) moved providers because the deal offered by their current provider was too expensive.
To help mobile customers to switch or haggle for a better deal with their current provider, Which? is launching a mobile switching service. The service offers a transparent way for customers to compare deals across all major networks using Which?’s impartial reviews of phone providers and find the best one that meets their needs.
It follows Which?’s broadband and energy switching services, which have helped around 100,000 households switch to a better deal.
Says Natalie Hitchins, Head of Home Products and Services at Which?
“Nearly a year after end-of-contract notifications were introduced, our research shows mobile customers are less likely than broadband or TV customers to act when their contract ends and many are still grossly overpaying on their bills.
“This is why Which? has launched a mobile switching service to help people who have reached the end of their contract to compare the best deals on offer so they can easily switch providers or haggle for a better deal.”
Third of customers still being hit by mobile phone overpayments rip-off, Which? reveals