Three Mobile will hit the majority of its pay monthly customers with price hikes from July.

The mobile phone giant will up the cost of monthly plans by 3.6% on all its tariffs, but only if a customer signed up before 8 March. The rise will also hit mobile broadband customers.

On a 30 monthly plan, this would represent a 1.08 monthly or 12.96 annual increase. The cost of calls and data will not rise.

Can I cancel my contract early?

Three won't allow customers to leave their contract early without penalty, as its terms state inflation-linked price rises are allowed. In this case, Three's increase follows March's 3.6% rise in the retail prices index.

Three blames rising inflation, which has resulted in growing costs for its business.

It says in an email to customers: "We know that increases are never welcome, so it's not a decision we've taken lightly and were confident that your plan still represents excellent value for money."

The company refuses to say how many of its users are affected. However, pay-as-you-go customers are unaffected.

Orange/T-Mobile hikes

Orange and T-Mobile similarly raised prices by 4.34% in January and 3.7% in May, respectively.

They also didn't allow contracted customers to switch without charge for the same reason. Regulator Ofcom ruled Orange was within its rights to do so, following widespread anger.

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Three price rise