How much it really costs to cancel your Cell C contract

Cell C customers who plan to cancel their contracts prematurely must be aware that the network charges an early penalty fee.

Under the Consumer Protection Act (CPA), a mobile network subscriber can cancel a fixed-term contract before the original expiry date.

The subscriber must give 20 business days’ notice in written or recorded form.

They will remain liable for money in arrears at the time of cancellation and fees that had already become due.

In addition, the provider is permitted, but not required, to charge a “reasonable” cancellation fee.

South Africa’s mobile networks take different approaches to calculating this amount.

In July 2021, Cell C told MyBroadband that when a customer wishes to cancel their contract prematurely, they would be liable to pay the following:

  • The remaining value of the handset at the time of the request cancellation.
  • The amount on the current month’s invoice

The operator said its practice was not to levy any penalties over and above the charges the client was liable for.

In that way, it maintained it was conforming to the “reasonable penalty” rule as determined by the CPA.

50% penalty fee

However, Cell C’s 2021 subscriber agreement terms and conditions also refer to an additional penalty fee alongside the amounts mentioned above.

According to the document, the operator charges a cancellation penalty equal to the product of 50% of the remainder of the contract period and the subscription fees.

One MyBroadband reader recently tried to cancel their contract three months before expiry to see what it would cost.

The contract was a 24-month Pinnacle 2GB package with a Samsung Galaxy A70 smartphone.

After calling Cell C’s cancellation department, an agent told her that she would have to pay R1,550 for an early release from the contract.

The subscription and device fee cost R429 per month, meaning the total contract amount outstanding for the next three months would be R1,287.

The penalty fee would be 50% of that amount, which worked out to R643.50.

In addition, the customer must pay the outstanding value of the device, which costs R250 per month, according to their monthly statements.

They had also accumulated R99.98 in out-of-bundle usage by the end of the month of the cancellation request.

Therefore, the cancellation fee should have been R1,493.48 — around R56 less than the amount quoted.

MyBroadband contacted Cell C to explain this difference and asked why it had not previously disclosed the penalty fee.

Cell C chief commercial officer Simo Mkhize said the network had revised its terms and conditions on early cancellation applicable to 24 months SIM-only contracts “in line with the industry norm for post-paid products”.

“With these offers, customers get the benefit of highly discounted rates for the duration of the contract, hence the penalty fee should they cancel earlier than contracted for,” Mkhize said.

“The changes have been communicated to customers well in advance and in accordance with ICASA requirements.”

The table below provides a breakdown of the costs associated with the Cell C customer’s early cancellation.

Cell C contract cancellation breakdown
Item Cost
Remaining value of the handset R750 (R250 x 3)
Early cancellation penalty — 50% of remaining subscription fees R643.50 ([R429 x 3] x 0.5)
Outstanding out-of-bundle balance for December 2022 R99.98
Total settlement amount for cancellation R1,493.48
Cell C’s quoted early cancellation fee R1,550
Total amount if staying on contract  R1,386.98 ([R429 x 3] + R99.98)

Now read: MTN responds to customer concerns and revises price increase approach

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How much it really costs to cancel your Cell C contract