With most mobile contracts lasting a period of 24 months, consumers may find themselves needing to cancel their contracts earlier than agreed with their provider.
And while the Consumer Protection Act has ensured increased protection for consumers, SA mobile operators vary when it comes to charging for early contract cancellations.
Let’s look at the various charges and terms and conditions set out by the four biggest mobile operators in SA.
According to MTN chief customer experience officer, Eddie Moyce, in accordance with the CPA MTN charges the following cancellation penalties for early termination:
- All unbilled and outstanding invoices at the time of termination (if any).
- One month’s subscription.
- Balance owing on the device.
Vodacom says it charges a maximum cancellation fee of 75% which is determined by where a customer is in their contract.
“If a customer cancels early on we will still need to recoup the handset and subsidies whereas later on in the contract the cancellation fee will be much less.
“Basically, if a customer wanted to cancel their contract our systems would look at the remaining monthly subscription as well as any additional pay-in they did on their handset. From there the system calculates what the customer owes and, as per CPA guidelines, we then reduce that amount by 25%,” it said.
Cell C said it amended its subscriber agreement to be CPA compliant prior to the implementation of the CPA.
Customers are entitled to cancel their subscriber agreements prior to the expiry date, it said.
“With regards to early cancellations, Cell C has introduced a reasonable cancellation penalty which is linked to the value of the goods supplied to the customer.
“In addition to the cancellation penalty, the customer will remain liable for all subscription charges and usage fees that have been billed, but not yet paid by the customer,” Cell C said.
The operator provided an extract from the current subscriber agreement:
10.3 – What happens if you cancel this Agreement?
10.3.1 – If you cancel this Agreement before the expiry of the Contract Period or the Renewal Period, then you will be liable to us and undertake to pay us on demand:
10.3.1.1 – a reasonable cancellation penalty in respect of any of our Services which would have continued for the remaining contract period;
10.3.1.2 – the outstanding value of the Goods on the date of cancellation of the Agreement; and
10.3.1.3 – the outstanding Subscription Fees and Usage Charges which have been billed but not yet paid by you.
A Telkom spokesperson said it was difficult to provide a single answer as the charges differed in relation to the package, device and how far into the contract, the customer was. “Its a moving target,” the spokesman said.
In a document on the group’s website, Telkom says for early terminations: “The subscriber shall be liable to pay upon early termination or cancellation of the contract, where applicable, any associated costs such as administration charges, outstanding device costs, service charges etc.
“The early termination/cancellation fee will be calculated at the time of requesting the early termination.”
Source: Business Tech