Thousands of customers with Vodafone and on the Three mobile network could see a rise in their bills next year as new contract changes begin.

Three and Vodafone pay monthly mobile or broadband customers who sign up to a new deal or upgrade to a fresh contract face price increases in 2021 - after the companies altered their terms and conditions.

How much will costs rise by?

Although mobile phone firms usually increase prices each year based on inflation, the operators have said that, next year, customers who are new or choose to upgrade will face higher fees.

Three Mobile is to increase bills for new customers or those who upgraded after October 29, 2020 by 4.5 per cent each April, affecting SIM only, mobile broadband and home broadband customers.

Vodafone will hike costs for customers who joined or upgraded after December 9, based on the Consumer Price Index (CPI) - which is currently 0.7 per cent - plus 3.9 per cent.

This will affect all pay monthly customers, including those with mobile contracts, SIM only and home broadband deals, and tablet, Apple and Samsung Watch, OneNumber for Watch and Vodafone Basics plans.

Vodafone said customers on average contracts would pay around £20 to £22 more a year, but this will vary based on the price plan the customer is on.

Three said the average monthly cost for contract voice customers is £24.45, and a 4.5 per crnt increase will mean an average increase per year of £13.20, or an increase of £1.20 a month.

Customers who joined before those dates will still be subject to increases by the old measures.

What have Three UK said?

A spokesperson for Three UK said: “Like other mobile providers, our pay monthly plans are subject to an annual price change. We have taken the decision to apply an annual fixed percentage increase of 4.5% for new and upgrading customers from 29 October 2020. This means, for example, that a £20 per month contract will see an increase of 90p per month. This change will be applied in April 2021.

“We believe that integral to a great customer experience is certainty and transparency. With a fixed price change compared to the variable and unpredictable increases applied by other MNOs, customers will not have to rely on a fluctuating RPI or CPI rate to clearly understand the full cost of their contract.

"Central to providing the best possible service and range of products is our network, and we must invest more to deliver on this.

"We are investing +£2 billion in the UK’s fastest 5G network to ensure we have a strong network, capable of delivering better connectivity, every day, for every customer.”

Can I leave my contract?

If you renew or sign a new Three contract on or after October 29, 2020, or a new Vodafone contract on or after December 9, 2020, then you will not be able to leave penalty-free if you are unhappy with this new price increase.

However, if you are unhappy with the price hike, but cannot yet leave your contract, then it’s worth noting down when your contract will end, so you can start looking for new deals shortly before it’s set to finish.

If you're an existing customer of Three or Vodafone and outside of your minimum contract term, then you will not be affected by this price rise until you decide to renew.

If you’re unhappy with the upcoming rise in prices, then it’s worth looking around and comparing prices to find the best deal for you.