If the past few months is any indication, this new fee Sprint is charging won’t be around long. But let’s go ahead and talk about it since it’s yet another way one of the wireless carriers is trying to make more money off their customers in a questionable way, and you need to know about it when they do that. Last August, T-Mobile announced it would be charging customers a new fee to receive paper bills. They said it was to encourage customers to go paperless, but apparently they didn’t understand how incentives work. A few weeks later, after a huge backlash from customers, the blogosphere, and threats of lawsuits from more than one state Attorney General, the carrier backed down and said it would find a better way to help their customers go green. Apparently, Sprint wasn’t paying attention because they’ve just started charging customers in their Account Spending Limit (ASL) program a fee if they’re not enrolled in automatic payments. Sprint’s ASL program is involuntarily imposed upon people with poor credit ratings to ensure their accounts don’t get out of control, and more importantly, to ensure they can pay their bill every month. But customers can also voluntarily join the program. Maybe someone wants to make sure their kids don’t go overboard with texting, or they’re just trying to be responsible with their budgeting. The customer who brought this new fee to the attention of The Consumerist joined the program to protect herself in case her phone was ever stolen, so she wouldn’t get a huge bill for the potential thief’s usage. Pretty smart, if you ask me, especially since she’s on a limited income. But now Sprint is punishing people in the ASL program. Let’s examine this for a moment. Because the program was created to control the usage of those with poor credit ratings, it stands to reason that many of those people don’t have bank accounts. It’s not just credit card companies that check credit ratings. Banks do too before they’ll open a new account. It also stands to reason that someone with poor credit may not be able to improve their credit rating because they don’t make a lot of money, and what they do make goes to monthly expenses rather than paying off debt, so they’re unable to open bank accounts even if they want to. So just like T-Mobile’s fee took advantage of those without computers, or perhaps seniors or other people who aren’t very computer literate, it seems that Sprint’s new fee is taking advantage of low-income customers. In order to enroll in automatic payments, a customer has to have a bank account. Their wireless bill is then directly withdrawn from their checking account every month. Anyone without a bank account obviously can’t enroll in the program, so in addition to not making much money, and already having a spending limit imposed upon them, they have to pay another $4.99 a month for the privilege of paying their bill in cash. What about those customers who voluntarily enroll in the ASL program to protect themselves from potential thieves, or control their kids’ cell phone usage? They may have bank accounts, and have no trouble paying their bill every month, but they’re being forced to either enroll in a program or pay a fee. Sure, businesses can charge fees for services, and the market sets the prices. But when companies start imposing arbitrary fees that seem to target a specific group of people, two things happen: customers get upset and start complaining, loudly; and the Federal Communications Commission (FCC) takes note as Verizon found out recently when they had to answer for their newly doubled early termination fees applicable to customers with smartphones. They’re not out of hot water yet, either. Anyway, if things go the way they did for T-Mobile and their paper billing fee, Sprint will be backpedaling soon and doing away with this ASL fee. But just in case they don’t, if you’re a Sprint customer, you may want to let them know how you feel about this because even if you’re not enrolled in the ASL program, if they get away with charging one unfair fee, it’s only a matter of time before they come up with another one that does apply to you.
7 comments… read them below or add one
I have been a loyal Sprint customer now for over 10 years, and received the letter that explains the new charge yesterday, January 11th. One thing I noticed in the letter is that the new program starts on January 10th. Interesting how I would get the letter after it already started. When I recently purchased a new phone, I was required to renew my contract. In that contract I agreed to pay the monthly bill that Sprint sends to me. When they send this letter and change the terms, they are essentially voiding my contract. I was looking for a reason to leave the sketchy ways of Sprint, and now is my chance…and I will not even have to pay the early termination fee!
You’re right, Chris. The new fee does seem to impose a material change to the original contract of anyone enrolled in the ASL program, which should indeed allow you to cancel that contract without the early termination fee. Be sure to point this out to them if and when you cancel, though, so you don’t have them coming after you for the ETF later on.
Michelle – We appreciate you trying to educate your readers, but I want to take an opportunity to clarify some of your points.
First, the charge is being assessed so that we are able to continue supporting this program for our customers. The program is unique in the industry as customers are given tools that help them better manage their wireless spending each month – monitoring and pacing their wireless use.
Second, we realize not every customer wants to pay the fee and that’s why we are offering other options including waiving the fee for customers who sign up for recurring auto-pay service with their credit or debit card, or through their checking account. In addition, we also offer the option of choosing one of the best prepaid offerings in the industry today through Boost or Virgin Mobile services. And of course, after 18 months of service and responsible payment customers may “graduate” to unrestricted service, removing the spending limit and the charge altogether. It’s also important to note that even with this new fee, spending limit customers still receive the best value in post-paid pricing plans in the industry.
Third, it’s not accurate or fair to assume that these are “low-income” customers as you suggest in your article. Customers who use this program are typically high spenders of monthly cell service, and they typically use a lot of services such as voice messaging and data. There are many factors that go into a customer’s decision to voluntarily choose to be placed on the Spending Limit program or in Sprint’s decision to place them in the program – and it’s not simply credit score or income alone.
Finally, we believe this is an important program as again it affords these customers benefits and tools to help them manage their wireless spend over the entire lifecycle.
Roni Singleton
Sprint PR
Roni,
Thank you for taking the time to comment. I’d also like to take the opportunity to clarify some things in the post, and address your concerns
First, I find it difficult to fathom that administering such a program requires much management. Not to impugn anyone’s job at Sprint, but in this day of advanced technology, I would imagine that account spending limits could be electronically placed and enforced.
Second, in the instance that it does require support, as you say, it’s a little disconcerting that, as the previous commenter indicated, and the customer who brought this new fee to the attention of The Consumerist also noted, customers in the ASL program were not given much notice, if any at all, about the new fee. It seems that if the program, and the fee to support it, were put into effect to help customers, Sprint would have let them know about the change sooner to give them the opportunity to opt out of the program if they wished, and take advantage of the other options you outlined in your response. I can’t imagine Sprint instituted a new fee to support such a program without any consideration or decision-making process on the part of the company. In other words, the company had to know for a period of time this fee would be charged, prior to it actually coming about. To send letters to your customers that arrived within days, or the day after that fee went into effect is at best, poor execution, at worst, a questionable practice.
Third, while I did say that some of the customers in the ASL program might be low-income, if you’ll read the post again, you’ll see that I also pointed out some people may enroll in the program voluntarily to control their spending, or protect themselves in the event their phone is stolen, just to name a couple of examples of how this program could be used. I did not state that enrollment in the program was based on credit score or income alone, merely that they are only two factors for enrollment in the program. In fact, they’re factors for anyone signing up for any wireless service, not just a program such as this.
Finally, I’m not disputing that it’s an important program. As I said, it can come in very handy for those on a budget who want to control their spending, or who have heard the horror stories about people having their cell phone stolen and then receiving huge bills due to the thief’s usage. What I am questioning is the need for a fee when, up to this point, no fee has been charged, and the manner in which the fee was instituted, i.e., without proper notice to customers. I am questioning a fee being added to a program that, by its very nature, is meant to help people control their spending, whether they’re low-income, or simply on a budget. It seems counterintuitive to acknowledge that someone wants or needs to save money, and then charge them an extra fee in addition to limiting what they can spend on their wireless account. In that sense, it does come off as Sprint taking advantage of people in that situation, and who are enrolled in the program.
Again, I appreciate your taking the time to comment.
Bad idea Sprint.
I just got this letter today also, marked Dec21. Today is the 14th of January. I have been with you for over 4 years now. I have been billed incorrectly 4 times. The worst was $250. If you accidentally took $250 from my account, everything would be a mess. 1) I do not trust you with my account info. 2) I will not pay you an extra $5 every month. You can say goodbye to my $1200 I give you every year. I’m switching to Verizion.
Goodbye Sprint, the ASL program is electronically maintained through a software program. Once put on this program your account is monitored with no HUMAN intervention, except to be put in the program and taken out with just a click of a mouse…Sprint you are PATHETIC, I have 4 lines and I will now take my business elsewhere. The reality is I have no dependency on cell phones, so maybe just canceling all cell phone use is the answer.
Found this page after discovering (2) ASL charges on my (surprise!) 2nd monthly bill. Somehow with all their advanced electronic billing, it is impossible to put the 1st month ASL charge on the 1st month bill (within the 30 day return window)…
Shame on you Sprint.