O2 is hiking its prices for millions of customers as bills are set to increase by 1.4 per cent from April.
The telecom provider is contacting customers this week to notify them about the rising rates, and those who are affected will not be able to cancel their contract without incurring a penalty fee.
How much will bills increase?
The prices of customers’ monthly airtime tariff is being adjusted in line with the 1.4 per cent Retail Price Index (RPI) rate of inflation, which was announced in February.
Customers’ bills will be adjusted by this amount in April and will affect those on sim-only, contact and mobile broadband plans who are still in contract.
The level of increase will depend on the type of contract you are on.
Those who are on an O2 Refresh contract, which splits the bill into separate airtime and phone costs, will only see an increase on the airtime part of their bill. For example, if your airtime plan costs £26 per month, this will increase by £0.36.
Here is a breakdown of the changes depending on when you took your contact out:
If you signed up before 23 January 2014
O2 terms and conditions means your monthly subscription charge can be adjusted by no more than RPI, only once every 12 months.
If you signed up after 23 January 2014
O2 terms and conditions state that your monthly subscription charge will be adjusted by the RPI rate published each February and the adjustment will appear on your April bill.
This years’ RPI was published on 17 February and was 1.4 per cent.
O2 Refresh tariff or Small Biz tariff
These airtime plans are subject to RPI, but the device plan is not. For example, if you are on a £22 O2 Refresh airtime plan, the increase of 1.4 per cent will mean your new monthly payment will be £22.30.
O2 said the maximum increase for its Refresh plan would be on the highest airtime tariff it sells, which is £35 airtime per month for unlimited data, minutes and texts. A 1.4 per cent increase on this would mean a rise of £5.88 across the year.
Everybody else on Pay Monthly
If you are on a sim only tariff, or a non-O2 Refresh Pay Monthly tariff, RPI will be applied to your monthly subscription charge. For example, if you pay a £27 per month tariff, the increase of 1.4 per cent will mean your new monthly subscription charge will be £27.37.
There is no price change for pay-as-you-go customers.
Customers who joined or upgraded with O2 before 17 February 2021 will have received a message from the company about the adjustment to prices and how it will impact their contract.
Anyone who joined or upgraded after this date will have been informed about it before signing up.
A spokesperson for O2 said: “Our Refresh tariffs mean that this industry increase is just 36p a month on O2's most popular plan.
"Unlike other operators we only apply RPI to the airtime part of our contracts on O2 Refresh, so customers are up to £50 a year better off.”