Thu, 03 Jul 2025

Thu, 03 Jul 2025 '£54k to rent five phones is killing my business'

A BBC investigation uncovers the crippling costs of telecoms services faced by small firms.
Small businesses across the UK are being charged inflated prices to rent phone equipment due to "unethical" practices, according to experts and affected business owners. A telecoms company, 4Com, has been accused of selling high-quality phones at prices that are several times higher than industry standards. The company offers seven-year finance deals for its products, which can cost tens of thousands of pounds for a small number of handsets. Independent experts have reviewed contracts provided by 4Com and concluded that the prices charged to customers are "outrageous" and "grossly inflated". They also alleged that leasing companies are enabling exploitative agreements at the expense of small businesses. One expert, Jonny Rae, said that the seven-year contracts appear designed solely to maximize finance revenue rather than meet a legitimate business need. He described the practices as "unethical" and stated that they have been going on for over a decade. Several business owners who signed finance agreements with 4Com have come forward to share their experiences of being charged high prices. One owner, Richard Jackson, was offered a £40,391 seven-year deal for four phones when he already had three, which experts estimated could be bought outright for less than £2,000. The government regulator Ofcom has stated that it will consider taking action if evidence of widespread issues is presented. However, the Communications Ombudsman and the Financial Conduct Authority have limited powers to regulate finance agreements signed by limited companies. Industry bodies representing the asset finance sector have acknowledged the need for greater transparency in contracts but emphasized the responsibility of business owners to scrutinize the terms of agreements with suppliers.
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