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Dutch telecom provider Simyo introduces cap on negative balances for prepaid plans

Dutch mobile telecom provider Simyo will introduce a cap on negative balances for prepaid plans and data plans. It announced these measures following talks between the company and the Netherlands Authority for Consumers & Markets (ACM).

Simyo is a mobile phone brand of Dutch telecom operator KPN. As a result of consumer complaints received by consumer information portal ConsuWijzer and by a popular Dutch consumer watchdog show, ACM urged Simyo to adjust its practices. Consumers reported that they unexpectedly faced substantial negative balances. They were under the impression that such was not possible with prepaid plans.

ACM enforces compliance with consumer protection regulations. ACM is of the opinion that consumers should be able to safely assume that they cannot be confronted with substantial negative balances when using prepaid plans. Many parents, for example, deliberately choose prepaid plans for their children in order to limit their voice and data usage. If providers still want to offer their customers the opportunity to finish a phone conversation or internet session, while their credit has been used up during that call or session, they can do so if consumer protection regulations are met.

In this case, this means that:

  • A low cap on negative balances for consumers is introduced;
  • Providers must inform consumers clearly about the risks of negative balances before consumers decide whether or not to take out prepaid plans.

After the talks with ACM, Simyo decided to cap negative balances for consumers at EUR 5. In addition, Simyo has updated the information on its website about this topic. Consumers are now able to find clearer information about the fact that it is possible to have negative balances with prepaid plans.