Mobile Users Could Save £100 a Year by Switching

Consumers who are out of contract with their mobile provider could be paying a loyalty penalty of nearly £100 a year, Which? magazine has revealed.

The consumer group is urging mobile users to take action when their contract ends, either by switching to a new provider or entering a new contract with their existing network, which it says could save them up to £96 a year.

If you don’t enter a new contract, most mobile providers will automatically roll you onto an out-of-contract plan, which will charge you more for the same service. EE, Three and Vodafone are notorious for high out-of-contract pricing.

To tackle this loyalty penalty, as of February 2020, telecoms regulator Ofcom requires mobile providers issue end of contract notifications to customers. These end of contract notifications, which can be delivered via letter, email or text, inform customers of the date their contract ends, the price paid before that date, any changes to price or service after that date, the notice period required to terminate the contract and the best deals the provider currently offers.

However, Which? has discovered that mobile users are more likely (13%) to ignore these end of contract notifications compared to customers of other telecoms services (9%) like broadband and pay-TV. 

The magazine polled 4,000 members of the public in October to determine how they react when they receive an end of contract notification. A third of mobile users (33%) surveyed said they haggled for a better deal with their current provider, while another third (35%) said they switched provider. Doing this saved them an average of £60 a year on their bills.

A fifth (20%) of mobile phone customers accept the deal their provider offered in the end of the contract notification. However, Which? warns customers that providers sometimes don’t always offer their best deal in the notification, although that’s a violation of Ofcom’s rules. 

Additionally, just accepting that offer doesn’t allow you to haggle for a lower price or more data or minutes.

Which? urges customers to take the opportunity of their contract ending to contact their provider and renegotiate. Alternatively, customers could seek out a better mobile deal from another operator.