How much it costs to cancel your mobile contract

South African mobile contract subscribers who are dissatisfied with their device, customer service, or network quality have the option to cancel their contract before expiry.

However, you should be aware that this can carry a hefty penalty cost.

Buying phones cash might be cheaper in the long run, but many South Africans cannot afford to put down thousands of rands up-front to pay for a smartphone.

In addition, contracts sometimes offer data, airtime, and SMSs at a discounted rate.

The option to pay off the device over 24 or 36 months, bundled with an allocation of the network services, is a package deal that many South Africans prefer.

But what happens if you are unhappy with your device or the service you receive from the operator and want to ditch them before the fixed term of your contract runs out?

Section 14 of the Consumer Protection Act (CPA) determines that subscribers are allowed to terminate a mobile contract at any time before the agreed expiry date.

While you don’t have to provide any specific reason for doing so, you will have to give the operator 20 business days’ notice in writing.

The network will then bill you for an outstanding “reasonable amount”.

This may be the same or more than the full amount that subscribers would pay if the contract had it run its course.

The CPA states that the amount must be calculated using the following criteria:

• The amount which you are still liable for, up to the date when cancelling the agreement.
• The value of transactions up to the cancellation date.
• The cost of the goods which will remain in your possession.
• The value of the products that you return to the supplier.
• The original duration of the agreement.
• The losses suffered or benefits you enjoyed as a result of entering into the contract.
• The length of notice of cancellation you provide.
• General industry practice — in telecoms, this will include all amounts owed for airtime, SMS, and data bundles that have already been used.

MyBroadband asked South Africa’s largest mobile network operators how their cancellation fees worked in the context of the “reasonable penalty” requirement of the CPA.

The table below compares the processes and costs involved for each provider.

Vodacom

Vodacom said its customers may send a cancellation note in writing or call the contact centre stating their intention to cancel.

The process takes approximately 4 to 7 working days to complete for premature cancellations — from the time the required payment is made, and all documentation is submitted.

Cancellation requests for expired contracts require 20 business days’ notice.

“If the cancellation notice has not been sent, after the contract term has come to an end, the contract would continue on a month-to-month basis, until such time the customer informs Vodacom of their intention to cancel,” the operator said.

To complete a premature contract cancellation, the customer will be required to pay the following:

• The remaining monthly subscriptions costs, with a standard 25% discount.
• Device fees multiplied by the number of months remaining on their contract.

MTN

MTN executive for corporate affairs Jacqui O’Sullivan said it was important to note that the operator offered an early “cooling off” period for online purchases. Subscribers may cancel a contract without penalty during this time.

If a customer is unhappy with a device or network performance within the first 7 days of delivery, they can return it along with all its accessories in good condition and have the contract terminated.

MTN requires 20 days’ working days notice for cancellations after this period, as set out by the CPA.

“Where a contract is cancelled before the expiry of the fixed term, MTN will charge an early termination fee as per the CPA.”

This is comprised of the following amounts:

• The remaining balance of the value of the mobile device.
• The monthly subscription up to the date it ends.
• All usage charges up to and including the date the contract ends.
• All other amounts that MTN can charge the consumer as per the agreement up to that date.
• An additional one month’s subscription.

MTN customers may not return a mobile device for a discount when the contract is cancelled, except in exceptional circumstances where the client found a device to be defective within the first six months of the purchase.

“This is considered on a case by case basis,” O’Sullivan said.

If you want to cancel your MTN contract, you can send an email to [email protected]. A retentions agent will then contact the customer to begin the process.

Customers can also visit an MTN store or contact its call centre to cancel their contract.

Telkom

Telkom said its cancellation penalties are calculated at the point of cancellation, and the earlier in the lifespan of the contract this is initiated, the higher the associated penalty.

Its cancellation fees consist of the following:

• Costs associated with the device.
• Costs associated with the provisioning of services.
• Admin fees.

Contractually, a customer is expected to tender a 30-day notice period, whether within or beyond the agreed contractual period.

Contracts that run over the fixed term specified in the agreement will automatically roll over to a month-to-month basis if the customer does not renew or terminate when the option is given.

Telkom said the termination would align with the 30-day notice period.

“The final bill will take an additional 30 days to accommodate for any out-of-bundle usage which may occur during the notice period which cannot be accounted for in advance when the termination fees are calculated.”

“Where a third-party ISP is involved in the provisioning of services, there may be additional delays due to the associated processes beyond the control of Telkom,” it added.

The operator also does not allow for devices to be returned.

Telkom recommended customers cancel their contracts via a phone call to its contact centre.

Mobile customers can dial 081 180, while fixed customers must call 10210.

Although there is also an option to do this via email or web portal and have Telkom call you back, operators said they were having issues getting hold of customers afterwards.

“We find that there are challenges with reaching customers via outbound diallers, primarily driven by apps such as Truecaller, which often have our numbers listed as telesales or spam. This becomes a point of frustration for customers and is probably less effective than the benefit of a real-time conversation,” Telkom said.

Cell C

As the CPA determines, Cell C allows customers to cancel their contracts at any point during the agreement period.

The operators said its current practice is not to charge any penalties over and above the charges the client is liable for.

As it stands, customers must pay the following:

• The remaining value of the handset at the time of the cancellation.
• The amount on the current invoice.

The cancellation will take effect 24 to 72 hours after the settlement payment is made.

Similar to Telkom, Cell C will also issue a further invoice to collect additional charges accrued during the notice period.

Customers can return handsets only in particular instances, such as when they are experiencing bad network connectivity.

Cell C customers can contact the Cancellation Department by dialling 084 143 and selecting option 2 to initiate a cancellation.

Alternatively, they can send an email to [email protected] or visit any Cell C store.

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