What's the catch on free (cash back) contracts?

andrewmoorcroft wrote:

Hi moneysavers.
I've looked at the sites suggested by martin to batter down mobile contracts. I note that there are some deals with some reasonable phones that include a 12 month contract on say 02 200 for £360/year with 3 cash backs of £360 total making the phone free! As long as you don't exceed the minutes and do send the bills in for cash back on time (may be recorded delivery!), then what's the catch? It looks as if with a little care and for 1hrs work you get a free contract and a phone to sell on ebay in 12 months time! Sounds too good to be true. Have i missed the plot or something.

Andrew
Catches could be:
1. The company that sells you the phone goes bust before you claim your cashback - for some of the newer outfits this may be more likely than you would think as they appear to be making little or no money at their prices. If they go bust, goodbuy to your cashback. I wouldn't touch some of the newer ones (and they appear to be very - too - cheap) with a bargepole.

2. Some of the less honest ones make it very difficult to claim your cash back - there are unclear terms in their T&C's and they will interpret them to deny you the money.

3. Even if you follow the terms, they may "forget" to process your claim and you have endless chasing. For example Phones4u (shame on them!) owe me three lots of cashback from months ago - no reply to emails, and they were one of the better ones.

4. If they all paid all the cashbacks they would lose money. Many pay lot less half and its not because people "forget" to claim back hundreds of pounds! About time OFT looked at this.

All that being said, there are some good cash back companies which have been around - not always the cheapest ones. Even the same ownership doesn't mean same treatment - see for example Carphone Warehouse (generally thought to be reasonable) and OneStopPhoneShop (generally thought to be apalling - just type OSPS and cashback in google and see - and they are owned by Carphone.

Hope the above helps
Joe

They get your money, shuv it in high interest account.. collect interest.. then a certain amount of it.. and giv u the rest back

for every 30 quid they keep for 3 mths they mite get .. say.. 35p and if they've sold 500 contracts, thats 175 quid or so.. (x4 for the year)

I have been struggling for the last 3 months to get a refund of line rental from a mobile phone supply company, I sent in all the appropriate paperwork, and had several promises of dates for the refund to be paid to me, no money was paid into my account! I contacted my local trading standards office, who wrote to the company on my behalf, another payment date was promised and yet again no money arrived! The trading standards are now writing to ask for their 'registered office address for the service of small claims'. and so the saga continues.............

joepubli wrote:

Please name and shame so that others don't use this company.

The company is 'themobs.com'. I wasn't sure if I should name the company, but I certainly wouldn't advise anyone to take up their offers, even though they advertise 'impeccable customer service'.