The Canadian Radio-television and Telecommunications Commission (CRTC) has announced today it has asked wireless service providers to cease 36 month device financing.
Currently, only Rogers offers a 36 month device financing option, where customers can pay a 0% annual percentage rate. Bell said yesterday it plans to also offer a 36 month financing option as well, at some point in the future.
“Today, we asked wireless service providers (WSPs) offering 36-month device financing plans to stop doing so while we ensure Canadians continue to be protected by the #WirelessCode,” said the CRTC on Twitter.
In a press release, the CRTC said it wants to “ensure Canadians continue to be protected by the Wireless Code,” despite it acknowledging longer financing terms beyond 24 months may make devices “more affordable and attractive for Canadians customers.”
In regards to 36 month device financing plans, the CRTC says they “may not be compliant with the Wireless Code since customers may have to pay fees to switch service providers, even after 24 months.”
In light of this, the Commission is “asking all wireless service providers to stop offering device financing plans on terms longer than 24 months until the Commission completes a full review of this practice.”
The CRTC says it will release a Notice of Consultation later to look into the matter in “greater detail,” and determine whether further regulation is required if longer financing terms are not compliant with the Wireless Code.
“Canadian customers have the right to make informed choices based on clarity. We want customers to have options for financing their device, if they so choose, but we also need to make sure these new 36 month device financing plans are fair for consumers. The Wireless Code protects consumers and gives them the ability to take advantage of competitive offers at least every two years. The CRTC is concerned by these financing plans as they appear to make it difficult for a customer to switch service providers even after 24 months,” explained Ian Scott, Chairperson and Chief Executive Officer, CRTC.
The CRTC says it may also fine wireless service providers penalties “for every contravention up to a maximum of $10,000,000, and $15,000,000 for every subsequent contravention.”
What do you think about 36 month device financing from wireless providers such as Rogers?