In the run up to Christmas, UK has seen a huge rise in the increase in popularity of mobile broadband suppliers offering free laptop deals to entice new business, but a report from Broadband Expert suggests that despite the credit crunch many mobile providers and retailers are turning away fifty percent of potential customers due to stringent credit checks.
In fact Broadband Expert say that one, perhaps over zealous provider is rejecting 75% of sales after running the necessary credit checks.
Many mobile providers are offering the mobile broadband and free laptop deals over a contract period of 18 to 24 months with a typical monthly cost of £25 to£40. These contracts require no down payment from the customer and represent a significant risk to the retailer.
Rob Webber Commercial Director at Broadband Expert said;
“Companies are spending huge amounts on advertising campaigns promoting these offers yet when the consumer comes to sign up, there is a strong chance they will be refused based on a credit check. The stringency of credit checks is an interesting barometer of the confidence retailers have in consumers meeting repayments with many only unwilling to extend these deals to those without a very good credit rating.”
Webber also adds that the mobile deals are “particularly popular with students and those on lower incomes who can not afford the upfront costs of a new laptop, yet these are the people most likely to be excluded from these offers.” He also notes that the “rejection rates demonstrate a different strategy with some companies prepared to take a more of a gamble to fill their order books and others choosing to play it safe by only targeting better off consumers they perceive as being low risk.”
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