Shenzhen Consumer Council has issued a warning to consumers to be cautious of prepaid deals after exposing 21 training institutions that closed down without refunding prepaid fees totaling 15.06 million yuan (US$2.18 million) to consumers.
Among the institutions, one outlet of Shenzhen Meilian International Education Technology Co. failed to refund 5.27 million yuan, according to information released at www.szcredit.org.cn.
In 2022, the consumer council received a total of 44,095 complaints regarding prepaid disputes, up by 3.42% year on year. Among them, 10,406 complaints were related to operators that either closed down or failed to refund fees, accounting for 23.6% of the complaints.
Education training, housekeeping, fitness and cosmetics were the main fields where prepaid deal disputes arose, with education accounting for about 64% of the total disputes.
To minimize risks associated with prepaid deals, the council recommended that consumers should choose institutions with good reputations, reduce the amount of prepaid fees, and shorten the prepaid payment periods. Consumers were advised to carefully read contract clauses before signing, keep evidence of payments, and call (0755) 12345 or (0755) 966315 if disputes arise.
China Consumers Association received a total of 70,000 training institution-related complaints in 2022. Some parents, coaxed by promotions such as tie-in sales and pre-deposit for refund, paid large fees for a long period, facing the risks of rising disputes.
In a move to reduce training-related disputes, the Ministry of Education and China Consumers Association jointly issued a notice Monday, reminding parents and students to choose training institutions with caution and pay fees rationally.
Parents are advised to sign up with licensed training institutions that have standardized training contracts, which are worked out by the Ministry of Education and the market supervision authority. Parents should not pay fees for more than three months or over 60 teaching hours. For the noncurricular training, fee payments should be no more than 5,000 yuan at one time.