Out-of-contract alerts for phone and broadband

PHONE and broadband customers will soon receive alerts telling them when they have reached the end of their contract under a crackdown by regulators.

Ofcom, the telecoms watchdog, will consult on “end-of-contract notifications” to outlaw a long-standing rip-off in which millions of customers are routinely overcharged. At present most providers do not inform customers when their terms are up and they could switch to a cheaper deal.

Every year at least six million mobile phone contract holders are charged for handsets they have already paid for, analysis of Ofcom data shows. Customers are unaware they only need to continue paying for calls, texts and data.

On average, those customers pay an unnecessary £22 a month, rising to £38 extra for smartphones. One in five only realise after six months, by which time they will be £228 worse off.

Similarly most broadband providers quietly move customers on to a more expensive tariff when their contract is up, leaving them paying over the odds. An estimated 15million households – around a third of all customers – are currently out of contract with their provider.

Ofcom said it aimed to consult on the details of the proposals in July.

A spokesman said: “Our in-depth research shows one of the key things people would find useful in helping them shop around is being told when their contract is coming to an end.”