O2 Refresh allows customers to get new phone when they want

O2 has announced a new tariff called Refresh which allows existing customers to upgrade to a new phone when they want without having to pay a fee to end their airtime contract. The offer will only be available in O2 stores (and not online) from 16 April.

The tariff is the first 24-month one to decouple the cost of the phone from the cost of the services (texts, calls and data). Users just need to pay the remaining balance of the plan and start afresh.

Customers signing for Refresh will get a phone plan and an airtime plan which they will sign and pay for separately. Should users want have a new handset before the end of their two year contract, they can pay off the remainder of their phone plan and end their airtime plan without any termination fee.

Three O2 Refresh Airtime monthly plans are on offer; £12 gets you 600 minutes, unlimited texts and 750MB, £17 gets users unlimited minutes, texts and 1GB of data while an additional £5 ups the data allowance to 2GB. In comparison, buying an O2 SIM-only tariff (12 month contract) would cost £16, £21 and £26 respectively.

Sounds complicated enough? Well, O2 gives the example of someone looking to buy the HTC One with unlimited texts, unlimited minutes and 1GB of data. They would be paying £17 per month for the Airtime plan, £20 per month for their phone plan plus £49.99 up front, the same than on a traditional pay monthly tariff (or £818).