Warning for broadband customers over early cancellation fees – best and worst firms revealed

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BROADBAND customers are being hit with “astronomical” and “confusing” early disconnection fees costing hundreds of pounds.

Yesterday, telecoms firms pledged to waive fees for customers who move to cheaper deals without paying huge penalties.

However, experts have warned that these new rules will only apply to customers who are struggling financially – with many still facing hefty fees. 

Consumer expert Martyn James said: “The exit fees charged by broadband providers are extortionate and for too long have been applied without fairness or logic.

“I would like to see a clearer definition of what ‘financial difficulties’ means in real terms, so we can be sure all businesses are playing fair.” 

Marc Gander at the Consumer Action Group, said:  “These broadband suppliers should only be entitled to recover any administrative losses caused by the early exit.

“It is an absolute scandal.” 

Some telecoms giants calculate exit fees based on the cost of the contract and how long is left on a contract. 

While others charge a standardised fee and this makes it confusing and complex for customers to compare. 

The Sun compared fees based on the most expensive tariff available if a customer wanted to cancel one month into a contract.

For example, Virgin Media charges a maximum fee of £288 to cancel.

While Sky charges a maximum of almost £300 to exit its cheapest tariff, and upto £530 to leave its most expensive. 

Some firms will also allow customers to leave deals early, with Virgin Media allowing contracts to end within the last 30 days. 

Customers are usually only allowed to move broadband firms if they are out of contract and for a small number of reasons – otherwise they must pay a hefty fee. 

You can switch providers without paying a fee if you’re not getting the broadband speed you were promised when you took out their contract. 

Some suppliers may also let customers move to cheaper social tariffs mid-contract if they are struggling. 

Customers are also allowed to cancel a contract fee free during the first 14 days – known as the “cooling off period”. 

Providers are allowed to increase prices mid-contract, as long as they set it out in their terms and conditions.
The regulator Ofcom recently introduced rules to make it clearer to customers about how much extra they can expect bills to go up by. 

If firms hike prices mid-contract by more than they have set out in your terms and conditions then you may be able to leave without paying a fee.
Many experts and campaign groups argue that termination fees should be capped to reflect business costs. 

An Ofcom spokesperson said: “Under general contract law, phone and broadband companies can charge customers who decide not to see out the minimum term of their contracts.

“But under Ofcom rules, those charges must be made clear to customers before they sign up – and those rules have been strengthened this month.

“We’ve been calling on broadband firms to do more to support customers suffering financial hardship.

“While some have responded by offering social tariffs, we want to see all providers step up and offer these cheaper packages, and promote them more widely.”

A Virgin Media spokesman said: “Early disconnection fees are widely used by many businesses, not just telecoms, to calculate the payment due should a customer decide to end their contract early – information that is made clear when a customer signs up with us. 

“Only a small proportion of customers are charged the maximum amount which, unlike some providers, is capped.
“We recently removed the charges for customers moving home away from our network footprint and provide flexible monthly rolling contracts for anyone who cannot commit for longer periods of time.”

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