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ACMA Cracks Down On ‘Unaffordable’ Telco Plans

The Australian Communications and Media Authority (ACMA) has further cracked down on telcos selling ‘unaffordable’ plans, with new consumer protection rules approved today.

The code pledges to protect consumers from financially over-committing, ensuring responsible telco sales practices.

The new “revised and strengthened” Telecommunications Consumer Protections (TCP) Code requires telcos to clearly explain key terms and conditions, better assessing a customer’s capacity to pay.

New customers on total contracts over a $1000 (typically $45 per month) will now be required to provide telcos information about how they will pay their bill.

An external credit check from a credit reporting body will be required, with provisions also applying to pre-paid customers moving to post-paid.

Telcos could face penalties up to $10 million for failing to comply with ACMA directions.

The Communications Alliance led the development of the new code over the last two years, with input from consumers, government and industry – commencing August 1, 2019.

ACMA Chair, Nerida O’Loughlin, asserts customers are often encouraged to sign up to multiple plans – many “excessive or beyond their financial capacity.”

“‘The new TCP Code puts the onus on telcos to ensure customers understand what they are buying. We will be subjecting telcos to close scrutiny as to how well their practices conform with the new Code,” she adds.

The ACMA has pledged to monitor and investigate non-compliance, whilst testing the effectiveness of new rules.

“The impact of this is serious, particularly for those in vulnerable circumstances, leading to financial hardship and denial of access to critical services,” remarks O’Loughlin.

Further information is available on the ACMA’s website here.

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