Lycamobile is now adding a 5% "Recovery Fee" to all airtime purchased directly from Lycamobile. The 5% fee also applies to auto pay. For airtime purchased from Lycamobile dealers or online PIN sellers the fee is a flat $1 per top up regardless of the amount of the top up.
According to Lycamobile's Terms and Conditions page, "All website purchases, including auto-recharges, will be assessed the Charge, which are currently set at a flat rate of five percent (5%). These Charges are not mandated by law, but are collected and retained by Lycamobile in whole or in part. The components and amounts of these Charges are subject to change without notice. The Charges include, but are not limited to charges, costs, fees and certain taxes Lycamobile incurs to provide Services (and are not government taxes or fees imposed directly on our customers that we must collect by law)." In other words, this is a price increase rather than a new tax.
Charging a recovery fee is a sneaky way to raise prices while still advertising a lower price. It's a gimmick that seems to be gaining popularity with MVNOs. The TracFone brands which have been adding 1.7% in fees to auto payments and airtime purchased from their web sites for years. In 2014, Ultra Mobile added a $1 per top up recovery fee to all their plans. Other MVNOs charging regulatory or recovery fees include Tello, Project FI, Chit Chat, TPO, Consumer Cellular, Ting and Pure TalkUSA.
If you are a Lycamobile customer looking to save a little, the $1 flat fee that third party sellers are collecting is less than the 5% that Lyca itself is charging on top ups larger than $20. The new fee went live earlier this month and most of the online PIN sellers I checked have already added the $1 fee to Lycamobile PINs and direct top ups. One PIN vendor I've found that hasn't raised Lycamobile prices yet is Callingmart.com which is still selling Lycamobile refills at face value. Plus you can get 3% off Lycamobile airtime priced at $19 or higher using promo code ca3p-1207 at Callingmart.
For more about taxes and fees on prepaid plans see our post Making Sense of Taxes on Prepaid Cell Phone Plans and Airtime post.