Telcos, NTC oppose proposal to scrap validity periods of prepaid load

Senator Ralph Recto has filed a bill to prohibit the imposition of expiration period on the validity of mobile phone credit and the forfeiture of unused load credits of prepaid mobile users.

“This will ensure that every peso spent to purchase load credits [is] saved and usable until the day the credits are fully consumed,” Recto said in the explanatory note of his Senate Bill 2231, which was filed this month.

Recto cited a 2013 report of the National Telecommunications Commission (NTC) showing that there are approximately 100 million mobile phone subscribers in the country, with around 80 million of those using prepaid load.

“The large number of prepaid subscriptions has earned the Philippines the top spot on the world-wide list of countries with the most prepaid users,” Recto said.

“Recently, however, there have been rampant complaints that prepaid subscribers do not get the full value of the load credits that they paid for because of the expiration of prepaid call and text cards and forfeiture of un-utilized load credits,” he said.

Currently, the expiration period of prepaid call and text cards is two years while load credit's expiry ranges from 15 days to 120 days depending on the denomination.

Under SB 2231 to be known otherwise as the “Prepaid Load Protection Act of 2014”, telecommunications companies offering prepaid services can be penalized for the following:

• Imposition of an expiration period on the validity of unused prepaid call and text
• Forfeiture of load credits stored on an active prepaid phone account via prepaid call and text card or electronic transfer
• Refusal to give a refund to any prepaid subscriber whose load credits were forfeited without any valid cause

Penalties range from a fine of P500,000 to the revocation of licenses for the telecommunications companies as well as a fine of up to P1 million or two years of imprisonment for the directors and officers of telecommunications companies.

However, telecommunications companies have already said they oppose the proposed measure.

“Merong pong cost to maintain the load system. Kaya nga may mga charges at kaya rin may expiry period. So, we have to reconcile that,” said Smart Communications spokesperson Mon Isberto in an interview aired on GMA News' “24 Oras” Thursday evening.



“There should be an expiry because a dormant SIM (subscriber identity module) occupies a space in the network at may cost yun e, the cost of maintaining that SIM,” Globe Telecommunications Legal Division head Atty. Froilan Castelo said.

Engineer Edgardo Cabarios, NTC director, also opposed the proposal saying each prepaid subscription maintains a carrying cost once the subscriber turns on their cellphone unit.

He said removal of the expiration period would result in additional expenses on the part of the telecommunications companies, which they might, in turn, pass on to consumers.

“Mahirap tanggalin ang expiration unless papayag yung mga consumers na gumagamit ng network na i-subsidize nila yun (cost),” Cabarios said.

Cabarios however said that the NTC is now studying the possibility of extending further the vailidity periods of prepaid loads.

According to NTC records, validity periods of some denominations of prepaid load have recently  been extended by some telcos.

For example, credits of P1-P10 are now valid for three days from the previous one day; P11-P50 load is now valid for 15 days from the previous three days; P51-P100 load is now valid for one month from the previous 15 days; and the P300 load which is now valid for two months from the previous one month. — Elizabeth Marcelo/JDS, GMA News