MSE News

Ditched O2 after it hiked its price hike? Check you've not been wrongly charged £100s to leave

Woman sitting at a table using a laptop with paperwork spread out next to her.

Utilities Analyst

4 December 2025

O2 has charged some customers £100s to leave their contracts, while others have been asked to repay handset costs in full upfront. But this is WRONG. Anyone affected by O2's price hike on a price hike was entitled to cancel airtime contracts penalty-free, and to continue to pay off any handset contract as normal.

On 23 October, O2 announced it was increasing mid-contract price hikes from April 2026 for its up to 15.6 million new and existing customers by £2.50 a month, instead of the £1.80 that was originally promised.

MoneySavingExpert.com founder Martin Lewis went ballistic, saying it "made a mockery of regulator Ofcom's new rules", where you have to be told when you sign up of planned price hikes. We've been campaigning on this, as well as encouraging O2 users to haggle, or ditch and switch to a cheaper deal elsewhere, which MoneySavers have had success doing in droves.

The latest issues in a nutshell

However, many O2 users have since told us they've experienced problems cancelling their contracts. The two key issues we've seen are O2 users being:

Charged £100s to cancel their airtime (minutes, texts and data) contracts. With O2 telling them funds will be automatically debited.

Under Ofcom rules, your provider must give you 30 days' notice AND let you exit your contract penalty-free if it increases prices beyond what you agreed when you signed up. This means you're free to sign up to a new deal – either with your existing provider or with a new one.

We've been campaigning hard on this – and the Chancellor Rachel Reeves has now written to Ofcom asking for it to review the current 30-day telecoms cancellation rule. We believe there should be TWO 30-day windows you can leave penalty-free: one after notification, and the second after the hike takes force.
Told to repay handset costs in full upfront – which can also total £1,000s. With O2 telling them that if they don't pay within 14 days, the missed payment will potentially be passed on to a credit reference agency and/ or debt collection firm.

But this is incorrect. If you have an airtime and handset contract with O2, you can either switch the airtime plan only and stick with O2 for the handset element, which you'll remain paying monthly by default, or you can choose to repay the handset in full by calling 202.

Here are some examples of the problems we've seen, which we'll be reporting to Ofcom...

Issue one – some have wrongly been told to pay £100s in termination fees

Richard, via email: On your recommendation my wife and I recently transferred our O2 Sim-only contracts and we both received texts from O2 stating that the early termination charge would be £0.

However, I have now received a bill from O2 saying that the termination fee is £274.52! When I spoke to them on the phone they couldn't explain why this was, but nor were they able to cancel the fee.

Rebecca, via email: I recently took the advice to cancel my O2 Sim-only contract due to the mid-contract unexpected price hike. I would have liked to cancel over the phone or with an advisor but all the guidance given on the recorded messages, and the long wait times led me to cancel by just requesting my PAC (Porting Authorisation Code). This was quick and led me to quickly move to a new Sim-only contract.

However, after a few days O2 sent me a final bill for nearly £300. I then had to call up anyway to resolve this. It looks like they are not automatically allowing leavers to exercise their right to cancel.

Graeme, via email: I followed your advice after receiving emails advising of the change in T&Cs and tried to haggle a reduced price for our two O2 phones. We asked for our PACs, received this via email with confirmation of £0 termination fees.

Yesterday, we received a final bill of £100.21 via email. I called them this morning and they agreed to 'waive' their termination charge! It shouldn't have been charged in the first place!

Ben, via email: Both myself and my partner utilised your news story to leave O2 after their price hike and save ourselves a combined £227 annually, which nearly cut both our Sim-only plans in half!

Today, we were notified of our final bills, which included having to repay our O2 contracts IN FULL! We had left O2 within 30 days of the price increase and this happened to both our accounts, which are separate. We have since called them and sorted it; won't be paying a penny, as it should have originally been.

Issue two – other users have wrongly been told to repay handset costs upfront

Matt, via email: I was warned of the £2.50 price increase next April and decided to contact O2 to break from my airtime contract. After a lengthy discussion I reduced my airtime contract by £7 a month, which was fixed for 12 months. I had a device plan with O2, which I assumed would be unaffected and I would continue to make the monthly repayments on the plan.

Yesterday, I received the attached letter headed 'Enforcement and Termination Notice'... [MSE: The letter asked Matt to repay his credit agreement in full – an amount of £627.08.] I was quite taken aback by the threatening style of the letter given there was no mention of this when I spoke to them."

Jason, via email: I cancelled only the airtime plan due to the email I received saying that the price was jumping up. I wasn't going to pay that and thought now's the time to get out of the contract. I have now received a letter from O2 saying that I now owe for the handset. [MSE: Jason's letter states that he must repay £771.34 in full.]

Rebecca, via email: Both my father and I have our own accounts with O2. They didn't cancel our airtime penalty free, they cancelled our whole contracts. We've both received 'Enforcement and Termination' letters demanding £1,000+ worth of payments within 14 days for the devices they wrongfully cancelled.

O2 has successfully resolved some of the cases above, while others are still awaiting resolutions.

Check you've not been wrongly charged

If you left O2 after it increased its price hike, check you've not been billed incorrectly.

Check for correspondence on this from O2. When it comes to cancelling airtime plans, O2 has typically sent customers emails and text messages, so search here first. If your handset plan has been wrongly cancelled too, check your post, as MoneySavers have received these notifications via physical letters.
Check your bank and credit card statements. These should reveal any unexpected payments to O2.
Check your credit report for recent missed payments to O2.

What to do if you've been incorrectly billed

If you're affected, here are the steps you should take:

Complain to O2. You can contact O2 over the phone, online, via social media and in store.
- If you've been wrongly told to pay an exit fee or to repay your contract or handset in full, explain your rights.
- If you've been wrongly charged, ask O2 to refund any costs and put you back into the position you should have been in.
- If any incorrect info has been added to your credit file, ask O2 to amend it. You can also add a notice of correction to your credit report yourself in the meantime. See our full info on Fighting unfair defaults.
Getting nowhere? Go to the Communications Ombudsman. This applies if O2 doesn't respond to your complaint within eight weeks, or if it sends you a deadlock letter. The Communications Ombudsman can tell providers signed up to its scheme to fix the problem and to offer compensation, for example.
Missed payments passed on to a debt collection firm? Complain to the firm. Tell it you don't owe the money and provide any proof of this. If you're still being chased, check if you can complain about the firm to either the free Financial Ombudsman Service or to the Legal Ombudsman.

What does O2 say?

O2 told us it believes these problems only impact a small number of its millions of customers.

An O2 spokesperson said: "We have been fully transparent with our millions of customers about this change, writing directly to them and providing the right to exit without penalty if they wish, which is fully in line with existing rules."

They added: "Any customer who has any questions or concerns while exercising their right to exit is advised to contact us directly and our teams will be happy to support."