Consumers who believed they were receiving a complimentary handset through a China Telecom Corporation Limited (601728.SH) promotion have discovered an installment loan quietly attached to their accounts. Numerous complaints on the Black Cat Complaint platform describe sales representatives promoting a 99-yuan monthly package as a chance to get a smartphone for free, with the loan component only emerging later.
When contacted about the issue, a customer service representative for CHINA TELECOM explained that because some customers struggle to grasp the full details of such programs, staff deliberately simplify their explanations, avoiding the word "loan" to keep the pitch straightforward. From the user's perspective, the representative argued, the phone effectively costs nothing, as the carrier repays the installment as long as the monthly fee is paid on time.
A consumer identified as Ms. Huang recounted her experience to reporters. In April 2025, a door-to-door salesperson pitched a 99-yuan phone card package that supposedly included a free handset. Although she was only 20 and ineligible due to age restrictions, the staff member suggested her mother could sign up instead, emphasizing the attractive value of the deal. Huang subsequently registered the card under her mother's name and received a Redmi phone.
Months later, Huang noticed unexpected deductions from her Alipay Huabei account, revealing a 36-month installment plan of 63.5 yuan per month, with 16 payments already processed. The transaction, labeled as a "36-period Dafu Card 99 yuan (1800 yuan terminal rights fund)," totaled 2,286 yuan and was linked to CHINA TELECOM. When she confronted the original salesperson, he sent her a copy of the "Orange Installment Business Notification" bearing her signature, implying she was aware of the arrangement.
Huang admitted she did not carefully review the document, signing it after simply being told it was part of the phone giveaway process. The notification detailed a 1,800 yuan installment for a Redmi 14R (8+256), payable at 63.5 yuan monthly over 36 months. It also clarified that the program allows qualified telecom customers to use installment credit for purchases, with CHINA TELECOM providing monthly rebates to cover the payments, provided the customer maintains their tariff obligations.
Huang contends the representative failed to disclose that this was a loan product, accusing the company of inducing purchases while concealing critical information, including potential penalties for missed payments. She is seeking a fair resolution. When reached, the salesperson who handled her account stated he only managed delivery and insisted he had clearly communicated all business terms, noting that if the phone bill is unpaid, the deduction from Alipay kicks in as a fallback mechanism.
Black Cat Complaint platform data shows nearly 2,800 complaints mentioning "Telecom" and "Orange Installment," with many users echoing similar concerns. Several complainants claim they were only told about the free phone offer, with no mention of the underlying consumer loan, only discovering the debt when checking their credit reports, sometimes during home purchases. One affected user expressed frustration, saying they had already repaid the amount to sever ties with the telecom operator entirely.
A CHINA TELECOM customer service representative acknowledged the pattern, reiterating that simplified explanations are intentional for users unfamiliar with such programs. The representative described the process as enabling customers to acquire electronics through installment plans without direct repayment responsibilities, as the carrier settles the installments when customers maintain their monthly fees. The representative also noted that the Orange Installment platform operates as a financial partner of CHINA TELECOM, though specific corporate details were unavailable.
On the question of credit report impact, the representative assured that since September 28, 2023, all newly registered Orange Installment users have been excluded from systems linked to credit reporting agencies. Even missed fee payments would only trigger late charges, not affect personal credit records.
This controversy echoes issues exposed years ago, with state media reporting as early as 2020 on telecom outlets offering "free phones" or "1-yuan phones" while allegedly enrolling customers in installment loans without explicit consent. Reports at the time described sales staff deflecting questions about financing, claiming customers only needed to pay their phone bills, while the actual loan authorization was obtained through seemingly innocuous actions like a customer nodding toward a camera.
In those earlier investigations, customer service representatives initially denied any loan implications before eventually acknowledging that users were effectively authorizing loans through CHINA TELECOM's ecosystem when they consented to the facial recognition verification step. The carrier's alleged practice involved framing interest costs as "red envelope rebates" to mask the true nature of the transaction.
Sweet Orange Financing Leasing (Shanghai) Co., Ltd., the product provider behind Orange Installment, previously pledged to strengthen oversight of sales personnel and strictly penalize any concealment of loan details. The company is fully owned by Bestpay Payment Technology Co., Ltd., which counts CHINA TELECOM as its majority shareholder with a 94.43% stake.
Despite these assurances made six years ago, the persistent wave of similar complaints raises questions about whether meaningful changes have been implemented. Attempts to reach the leasing company through publicly listed contact channels went unanswered, mirroring the experience of attempts to contact CHINA TELECOM's spokesperson directly.