Business

Phone customers should reclaim money, Ofcom says

Man at computer at end of cable (Thinkstock)
Image caption A failure by some firms to make refunds automatically has been criticised by Ofcom

Customers of telecom firms have been told to reclaim money owed to them when they switch contracts.

The regulator Ofcom says in the past two years about two million people have left at least £10m on their old accounts.

Typically the money is for line rental paid in advance, or promotional credits offered at the start of a contract.

Ofcom said its advice applied to mobile and landline phone services, broadband connections, and pay TV.

Out of pocket

The regulator said all companies should automatically refund all money owed, but until now only three had done so.

It said only BT, Orange and the Post Office had had a policy of automatically refunding all outstanding money on their customers' accounts.

T-Mobile has now agreed to do so and Vodafone is now doing so for its direct debit customers.

Meanwhile Virgin Media and Virgin Mobile have agreed to do so from 1 December for sums greater than £1, and O2 will now automatically credit sums of more than £20.

But Ofcom said Sky, Talk Talk and Three are still insisting on customers contacting them first.

The regulator criticised this stance, saying everyone in the industry should refund customers with all the outstanding credit they were owed, without customers having to ask first.

"Consumers were telling us that they found it difficult to claim unused credit from their providers when they left their contracts," said Ofcom's chief executive, Ed Richards.

"Taken together, people have been millions of pounds out of pocket as a result.

"We hope that automated refund processes, clearer signposting by providers and our new consumer guide should help consumers claim back money that is rightfully theirs," he added.

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