The Financial Hardship Industry Standard reflects that there are many sources of vulnerability. These can result in, or contribute to, a customer being in financial hardship and therefore unable to meet their financial commitments to their telco or being at risk of not being able to stay connected, including to be able to access services or the supports they need.
The obligations in the Standard are intended to achieve an outcome where:
- Carriage Service Providers (CSPs) are proactively identifying customers who are or might be in financial hardship
- Customers in financial hardship can get information and assistance
- CSPs will work with customers in financial hardship to help them stay connected, with assistance appropriate to their circumstances. This assistance will differ based on the customer’s circumstances, the type of products or services that customer has and the nature of the arrangement the customer has with their CSP.
The Standard does not require that a particular form of assistance be provided to a particular customer.
Q.1 Do CSPs that offer prepaid services need to have a payment assistance policy and offer assistance to customers using those services?
Answer: Yes. The Standard makes no distinction between the obligation to offer assistance to customers who pre-pay for their services and those who pay after receiving their service. This is consistent with how the obligations that used to sit in Chapter 7 of C628:2019 Telecommunications Consumer Protections (TCP) Code were framed.
Q.2 Do CSPs have to offer payment plans to prepaid customers?
Answer: Yes. The requirement to offer payment plans to financial hardship customers that are tailored to meet a customer’s ability to pay is mandatory.
One example of a tailored payment arrangement to help prepaid customers keep access to an active telecommunication service could be offering reduced services for less cost for upcoming months for prepaid plans if the customer was unable to load the full monthly credit allowance.
Q.3 Do CSPs have to offer to postpone, extend or defer a bill for prepaid customers, when prepaid customers don’t receive a bill?
Answer: Yes. The requirement to offer financial hardship customers the option to postpone, extend or defer a bill is mandatory. This includes prepaid customers who fall within the definition of a financial hardship customer.
This allows customers to postpone, extend or defer the time for payment of the service while retaining access/connection to their service. For example, this would apply to prepaid customers who have an auto renew arrangement by direct debit or autopayment.
CSPs can also offer additional payment options, which may be better suited to that customer’s service.
Q.4 Why would a prepaid customer need financial assistance when they pay for the service upfront?
Answer: There are circumstances where a ‘prepaid’ customer falls within the definition of ‘financial hardship customer’, including if they pay by rolling direct debit or auto-renew subscription style arrangements. CSPs should be identifying and talking to these customers about their options for financial hardship assistance under the Standard.
Q.5 What is the difference between Financial Hardship assistance and Financial Hardship arrangement?
Answer: Financial Hardship assistance is defined as the assistance a CSP offers to help financial hardship customers to continue to access their telecommunications products (which includes both telecommunications goods and services) or to pay a debt owed to the CSP. Financial hardship arrangements applies to any arrangement made with the CSP for financial assistance.
Q.6 What is the difference between section 9 and section 15 of the Financial Hardship Standard?
Answer: These provisions focus on different stages of customer interaction.
Section 9 relates to the customer initiating contact with their CSP. Under the Standard, a Payment Assistance Policy requires a CSP to have 2 channels a customer can use for initial contact. A telephone number is only required at this point if it is a method ordinarily used by the CSP as a contact method for customers.
Section 15 focuses on the CSP making active contact with its customer where they are aware the customer may be experiencing financial hardship. At this point, customers must be offered the option of a telephone contact and email address. CSPs are also not limited to these methods of contact and may offer additional contact options.
Q.7 What contact information do CSPs have to give a customer when requesting the customer provide information to show they are in financial hardship?
Answer: When a CSP requests a customer provide information to show they are in financial hardship, the CSP must give the customer all the following options for providing that information:
- electronic method such as via the website or an app
- a physical address – this could be a store or a postal address
- another point of contact appropriate to their needs if they have a disability, are from a culturally and linguistically diverse background or have other special needs. This alternative point of contact should be determined by consulting with the customer.
Q.8 Are additional payment options offered by a CSP limited to helping customers with their bills?
Answer: No. Under the Standard, CSPs are expected to provide options that are tailored to the needs of their customers who are in financial hardship.
Q.9 What records do CSPs have to keep?
Answer: CSPs are required to keep records of financial hardship arrangements. A financial hardship arrangement applies to any arrangement made with a CSP for financial assistance.
Part 6 of the Standard sets out exactly what records must be kept, and for how long a CSP must keep these. It also includes obligations for those records where a CSP is not subject to the Privacy Act 1988.
Q.10 What about record keeping when there is no application form or a customer has used one of the self-service options to manage their financial hardship?
Answer: Records must be kept if a customer has asked for and received financial hardship assistance. The request itself is considered the application – no formal application is required.
If the customer has accessed a self-service option such as moving to a less expensive plan via the website without any communication about financial hardship with a CSP, then no record would be required as this would not be a financial hardship arrangement.