Botched phone plans and lack of data usage monitoring is leaving many Australians shell shocked over their mobile bills, with bills so large many can’t pay up or refuse to pay up, leading to an increased rate of defaults. We look at what is happening with Telco consumers, the new laws that have come in to combat bill shock, and some practical things that you can do to prevent it happening to you, and threatening your good credit rating.

By Graham Doessel, Founder and CEO of MyCRA Credit Rating Repairs and

A large number of current credit listing complaints we receive from telco consumers relate to data usage on mobile phones. Consumers are confused when it comes to data allowance on their smartphones, and the providers up till now, have not been helping.

Often clients claim they have gone over their allowance really quickly, or the plan they were put on was not appropriate for what they intended to use their mobile internet for. Often they can have great difficulty in cancelling the accounts or coming to a resolution with telcos over these billing issues.

Our current statistics show almost 26% of our credit repair clientele in the 12 months to July were telco customers.

Consumers have either reluctantly paid the bill, thought the matter was settled, only to find they were defaulted anyway, or they have just refused to pay the bill until they got some resolution – but have copped a bad credit rating through the account being more than 60 days in arrears.

Either way, they were dished out at least 5 years of bad credit from the episode unless they have been able to make a successful complaint.

Complaints numbers

Recently the Telecommunications Industry Ombudsman (TIO) surveyed its services. It counted 52,231 new complaints about telcos received between January and March 2012. Almost two-thirds were about mobile phone services.

The TIO reports new complaints about over-commitment caused by inadequate spend controls have over doubled in 12 months (4,282 in the January-March 2012 quarter, compared to 2,181 in the same quarter in 2011). In the same periods, new complaints about disputed internet charges increased 180 per cent (From 981 to 2,823).

“It is well known that more internet browsing and downloads are now done on mobile phones and other mobile devices. With this change in consumer behaviour, we have seen complaints about excess data charges almost treble over the last year,” Ombudsman Simon Cohen said.  “The incidence of these complaints will reduce if consumers are only contracted for services they can afford, and where spend management tools such as notifications and usage meters are accurate and reliable”.

The powers that be have heard the many complaints. Some changes have been swiftly made to improve transparency and service for telco customers. A revised Telecommunications Consumer Protection Code has been made in conjunction with the Australian Communications and Media Authority (ACMA) which will amongst other things require telcos to provide their customers with notifications when they have used 80% and 100% of their data usage in the plan.

These changes come after pressure from ACMA for Telcos to offer better protection for consumers, or face external regulation.

For more information on the TCP Code, see our September post ‘Telco bill shock should in theory now be a thing of the past.’

In the meantime, many consumers are still facing bill shock. We look at what you can do to prevent it.

Preventing Bill Shock published a great article late last week detailing some practical things that you can do to avoid bill shock. Here is an excerpt from ‘How to Avoid Bill Shock’:

Read Your Contract

I’ve said it before and somehow I feel I shall say it again: read the contract. From start to end. Before signing up to anything. Now, let’s just say you have already signed up and you didn’t read it before, you are not off the hook. Read it now. I’m serious, go do it… like, right now!

Now that you’ve read your contract, you’ll know exactly how much data you get for your regular fee and how much you’re going to pay if you exceed that limit. Without this knowledge, you’re really just playing a guessing game and you’re probably going to lose.

Don’t be Silly

Seems obvious, doesn’t it? Yet here we are. If you are on a limited data allowance, don’t fritter it away on silly things! When I first got my smart phone I was so enamoured by the fact that I could get the internet on my handset that I would lie in bed, checking the week ahead’s weather on my mobile rather than simple make the walk to the study and use my PC, on which the internet is virtually limitless! Fortunately, I did not have to learn the hard way but many people will. Don’t be one of them.

Start Downloading

I know, I know, I just told you not to download stuff but this is the exception. Downloading the right apps is going to make all the difference, in fact these two apps are the best way to keep your data use under control.

Data Usage Monitor

A data usage monitor like 3G Watchdog (Android) is a brilliant addition to your phone. Simply enter the date your billing cycle commences and your data allowance, and a little symbol appears on your phone’s desktop, changing colour to warn you when you’re reaching your limit.

Programme Closing

A programme-closing app is your next best friend. Apps like Advanced Task Killer enable you to close any programmes that might be running without your knowledge with the push of a button. And without programmes secretly running, chewing into your data allowance, you’re much less likely to suffer that dreaded disease, bill shock.

This is great advice. But what about if you already have a phone bill that has left your head spinning?

How to Dispute That Shocking Mobile Bill

1. Attempt to resolve the dispute with the Telco first. If a bill has just popped up you don’t agree with, let your Provider know, and DOCUMENT ALL CORRESPONDENCE WITH THEM (and document who you speak with if you are calling).

2. You may need to make a formal complaint in writing. If there is no resolution over the telephone, set out what specific resolution you require, and all the details of your complaint. The telco has 30 days to answer any written complaint you make.

2. Get all responses in writing. The matter may seem at an end, but sometimes people believe they have sorted it out only to find out later they have been defaulted anyway. If you have come to a resolution with the telco verbally, get it in writing and make sure it clearly states what will happen from here.

3. If the matter can’t be resolved to your satisfaction internally, take your case to the Telecommunications Industry Ombudsman. The TIO will make a decision on the matter, and their decision will be final. Make sure you provide as much evidence as you can for the Ombudsman to make an informed decision – you may only get one shot at it.

4. If at any stage you have a credit file listing from a Telco which you believe shouldn’t be there, you can undertake professional credit repair services. The credit repairer works on the consumer’s behalf to remove credit file listings which contain errors or inconsistencies or just out and out shouldn’t be there. It gives the consumer the best chance of presenting the best case for removal of a disputed listing, and actually having an unfair listing removed completely off your credit file. The credit repairer can also escalate the matter to the TIO on the client’s behalf if necessary.

If you would like help disputing your telco default or other credit listing, contact a Credit Repair Advisor on 1300 667 218 or visit our main website for more information MyCRA Credit Rating Repairs

Image: Ambro/