One in seven consumers in UK paying ‘loyalty penalty’, says charity

About one in seven people could be paying a “loyalty penalty” for products such as mortgages and mobile and broadband packages, according to Citizens Advice.

The charity said some UK households could save as much as £400 by switching, or seeking discounts, from their current suppliers.

Citizens Advice also said analysis of the budgets of 165,000 people who came to it for help with debts

uggested people on lower incomes can end up spending nearly double the proportion of their income on telecoms that those earning more do.

Citizens Advice said it heard from a woman called Tracy who signed up to a £30-a-month package which included TV, landline, broadband and international calls in 2006.

She relies on disability benefits.

In January this year, she started working through her bills to look for potential savings and was shocked to see her bill had increased to £80 a month over the years, the charity said.

She has now switched providers.

She told the charity: “Everything is going up: gas, electric, food, and I have a mortgage to pay.

I shop late in the evenings to get yellow-sticker discounted food

I turned off my gas as I can’t afford to repair the boiler or use the heating and I don’t go anywhere other than my hospital appointments.