We've got some important news for smartphone users everywhere. According to Citizens Advice, some customers are paying up to £38 a month for phone handsets that they’ve already bought.
Basically, if you stay on expired fixed deals, you could end up paying for the phone you’ve already paid off as part of your contract. So if you’re with Vodafone, EE and Three, be sure to check that you’re not paying extra.
This only seems to apply to high-range handsets like the iPhone 7, the Galaxy S8 or Xperia XZ Premium, so you've got nothing to worry about if you have a more basic phone. But you could even find yourself paying £46 extra every month for the iPhone 8 256GB model. This is absolutely crazy.
Gillian Guy, the chief executive of Citizens Advice said, 'Mobile phones are now an essential part of modern life, but the way that the cost of handsets are hidden within some contracts gives phone providers a way to exploit their customers'.
Most of us choose to take out a contract and pay for the phone as part of the deal over two years, and after that, you can decide whether to stay on the same contract, take out a new one or switch to a different network provider. But customers have ended up paying the same rate that they paid while the handset was still included in the monthly payment after the two year period.
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36 percent of people with this kind of contract ended up staying on it beyond the fixed period, and 19 percent stayed on it for over six months after they’d paid for their phone.
This has affected over-65s the most, with 23 percent of this demographic staying on their contract 12 months after the end of their fixed contract. However, it wasn’t just the over-65s that got caught out, as 13 percent of people below 65 ended up paying more than they should have 12 months after they'd paid off their phone.
Gillian Guy also said 'Some of the largest mobile phone providers are routinely overcharging their loyal customers.
'It is clearly unfair that some phone providers are charging loyal customers for handsets that they have already paid for.
'It’s especially concerning that older customers are more likely to be stung by this sharp practice.'
Guy also made the point that: ‘Providers could make it much easier for consumers to compare prices by separating out the cost of handsets from the cost of services like data and minutes for all contracts, that way it would be much clearer what they’re paying for.'
Nina Bibby, chief marketing officer of O2, said the provider separated device and service charges in monthly bills, and that O2 would like to see other operators 'review their position and follow our lead.'
As ever, this is a reminder that we really need to read the small print.
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This article originally appeared on The Debrief.