Picture: Siphiwe Sibeko/Reuters/African News Agency (ANA)
Picture: Siphiwe Sibeko/Reuters/African News Agency (ANA)

Consumer Watch: MTN denies ‘back door’ price increases occurred

By Georgina Crouth Time of article published Jan 13, 2020

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Did MTN sneak in a price increase at the end of last month?

Some contract consumers believe so, accusing the network provider of lumping around R8 onto their fixed packages without sufficient notification.

With about 5.6million contract customers in South Africa, that would amount to an additional R44.8million in revenue for the company.

MTN has denied claims that it had introduced the price increases surreptitiously, saying customers had advance notice, as far back as May last year.

The issue was raised by Mark Young of Durban, after he checked his latest bill and noticed the slight price discrepancy.

Three other contract customers have since complained on my Ask Georgie Facebook page about the same issue, saying they weren’t expecting their fixed contracts to be between R5 and R10 higher than normal.

Young writes: “I checked my own account, and would you know they had added a sneaky R5-odd to my bill and debited it? I noticed as I am on a fixed call/data/SMS package that cannot be exceeded so it has been consistently the same since inception - except for the end of December debit which was higher by that amount and the additional VAT.”

Young says he’s been trying to get an answer from the MTN customer care call centre but they are “experiencing a high volume of calls (I wonder why?) and there has been no follow-up for two days now”.

“I know they had a ‘billing error’ issue at odd times in the past. It seems however, that this is something they do when cash flow is needed. It gets the money in and those who notice can simply be refunded. For the rest, who don’t check a few rands’ difference on their accounts, they score.”

He says to wait six months to make a such a change, though minor, seems to be very odd way of introducing an increase: “The R5-odd increase is not the issue here. I am concerned about their methodology and the potential for fleecing the public if this is an ‘error’ again.”

But MTN has denied sneaking in a minor price increase: it says customers had been notified.

The network provider’s communications department says the post-paid (contract) price adjustments were implemented on May 1, 2019 and November 1, 2019.

“On March 29, 2019, MTN communicated these changes to customers via SMS, letters and media publications.

“On May 1, 2019, MTN updated its subscription prices for contract (post-paid) customers. The increase was approximately 4% and in some instances, it was slightly more, to align to market-related pricing. Even though some packages increased by more than 4% while others attracted no increase at all.

“In addition, selected My MTNChoice Flexi price plans, which include contract value, were supposed to be changed to align to the new subscription price from June 1, 2019. However, there was a delay in implementing these changes on June 1 - the price adjustment was then moved to November 1, 2019. Customers were informed about the price adjustment via SMS 21 days prior to November 1, 2019.”

MTN says that the inflationary environment which has contributed to increased input costs forced the company to make these price adjustments and that it has tried to keep the price increases as low as possible “in a bid to provide our customers with quality telecommunications services as cost-effectively as possible”.

It says customers who signed up to the existing price plans would have been informed about those price plan adjustments by customer sales representatives and that the increase date varied, depending on customers’ billing cycles. All terms and conditions remained the same.

Subscription pricing for the My MTNChoice Flexi 350 to 1500 price plan packages remained unchanged though.

To wait six months to make such a change does seem to be an odd way of increasing prices (and who would remember receiving the notification so many months later?).

Young says the R5-odd increase is not the issue.

Indeed - that small change adds up to millions in this case.

MTN has assured customers though that their request for personal information via email - an unsecured platform - is above board and not a cyber security risk.

“When the customer interacts with us via email ([email protected]) there are several security questions put to the customer to validate if we are communicating with the account holder. In fact, this happens across all platforms we interact with customers, social media, call centre and emails.”

The questions you’ll be asked relate to MTN PIN, your ID number, address and bank account name or type of account.

* Georgina Crouth is a consumer watchdog with serious bite. Write to her at [email protected], tweet her @georginacrouth and follow her on Facebook.

** Receive IOL's top stories via Whatsapp by sending your name to 0745573535

The Star

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