In order to be able to recover the advance payment of 11888 yuan for online courses, it took Shenzhen white-collar Guo Li six months to recover from Shenzhen to Shanghai. Under the coordination of the Consumer Protection Committee of Minhang District, Shanghai, she signed a mediation agreement with the online education platform WinKey Yingqi Online English (hereinafter referred to as "WinKey"). However, during the epidemic, the platform "runs off" and her money is still Drifted.
This year, CCTV’s "3.15" party also received hundreds of e-mails complaining to Hixue.com, and recently exposed the difficulty of refunds for Hixue students.
According to data from Qixinbao, there are currently close to 250,000 online education-related companies in China, of which close to 200,000 are in existence. From January to July 2020, 25,000 online education companies were registered and established, with an average of 120 new ones added every day. At the same time, the number of deregistered companies reached its peak in the past two and a half years in June this year.
The new crown pneumonia epidemic has contributed to the popularity of online education, but many problems are also emerging, and it is difficult to refund fees to top the list.
Chasing money for half a year to no avail
In July 2019, Guo Li learned on the Internet that "WinKey" provides one-on-one English courses for children as a foreign teacher. Guo Li's child is 3 years old. After chatting with the sales staff several times on the Internet, she was moved.
"At that time, the sales promised that they could get a full refund if they were dissatisfied with the audition. I spent 11,888 yuan on the half-year course." Guo Li said.
When the audition was over, Guo Li was not satisfied with the course and hoped for a refund, but what she did not expect was that it was easy to get a refund for buying a course. In order to refund, she experienced six months of bucking, and finally waiting for the company to shut down and run away.
WinKey was established in 2014 and is affiliated to Shanghai Guangyu Culture Communication Co., Ltd. (hereinafter referred to as "Guangyu Culture"), which is mainly engaged in one-on-one online children's foreign teachers.
"I will talk about financial business trip for a while, and financial resignation and need to reapply and go through the process..." Until the end of 2019, Guo Li couldn't help it, and entrusted a friend in Shanghai to find Guangyu Culture at No. 2988, Gudai Road, Minhang District, Shanghai. The registered place of Block 101 "begs for money".
On December 19, 2019, Guo Li's friend accepted the commission and came to the office of Guangyu Culture. Under the mediation of the Consumer Insurance Commission, Guangyu Culture agreed to refund the tuition fee of 11,888 yuan to Guo Li by bank transfer before January 24, 2020.
But Guo Li didn't wait for the refund, what she waited was Winkey's "run away". On February 3, Winkey issued an "Apology Letter to Students and Parents" (hereinafter referred to as "Apology Letter") to parents, indicating that the organization's cash flow is in a hurry. The reporter checked Qixinbao and found that Guangyu Culture had abnormal business operations, and the registered residence or business location could no longer be contacted from February 28, 2020.
After seeing the news, Guo Li, who had been exhausted physically and mentally by the incident for six months, decided to admit her life. "Winkey ran away after the Lunar New Year. I also put it aside. The sunk costs are not worth the effort." Guo Li said.
But what about Winkey's large number of students in class?
The solution proposed by the "Letter of Apology" is to transfer the unconsumed hours of current students to another training institution, Kuaiku English, which will provide a transitional course for Filipino foreign teachers with a one-month validity of 10 sessions. After the 10 packages are over, students can choose to purchase a certain number of Kuaiku English courses, and Winkey’s original courses will be converted to additional courses in the package.
According to the plan, in order to use the original course, it is necessary to spend additional money to purchase a new course, and it is almost impossible to complete the course package within 3 months.
Article 53 of the "Consumer Rights Protection Law of the People's Republic of China" stipulates that if a business operator provides goods or services in the form of advance payment, it shall provide it in accordance with the agreement. If the provision is not made in accordance with the agreement, the agreement shall be fulfilled or the advance payment shall be refunded in accordance with the requirements of the consumer; and the interest of the advance payment shall be borne by the consumer and the reasonable expenses that the consumer must pay.
But Winkey did not provide a refund option for the victimized consumers. For this reason, some parents are already following legal procedures.
According to Qixinbao's data, Guangyu Culture has 145 court announcements in 2020, which occurred in the second half of 2020, all of which are contract disputes. There are also records of violations of laws and regulations, such as tax arrears, administrative penalties, and persons subject to enforcement.
Consumption traps of online education
Why are Guo Li and other Winkey students in a very passive state after running the company? This is largely due to the advance payment system in the online education industry. In fact, in addition to the online education industry, prepaid consumption is also popular in industries such as beauty, hairdressing, and fitness.
Prepayment consumption refers to a consumption pattern in which consumers and operators agree that consumers pay funds in advance as prepayments, and after obtaining membership granted by operators, consumers have the right to obtain goods or receive services as members.
Wang Dong, a partner of Beijing Dacheng (Shanghai) Law Firm and Director of the State-owned and State-owned Enterprise Affairs Research Committee of the Shanghai Lawyers Association, told China Business News that in order to lock a certain scale of fixed consumer groups for a long time, the initial investment should be recovered as soon as possible, including the online education industry. Many of the merchants will vigorously promote prepaid consumption and attract consumers with ultra-low discounts based on the prepaid amount.
"However, this kind of consumption model is because consumers need to pay the consideration in advance, and the amount of payment is often high, and the consumption behavior is bound for a long time. This puts the already disadvantaged consumers in a more disadvantaged position and therefore bears a higher price. Contract performance risk." Wang Dong said.
Liu Chunquan, a lawyer at the Shanghai Duan and Duan Law Firm, believes that although prepayment and prepayment consumption in the online education industry are reasonable, the commercial risk is high. "The fundamental reason is that companies use prepaid cards as a means of financing, and some as money-trapping tools. Frequent runaway incidents indicate that many online education has become a tool for defrauding tuition fees." Liu Chunquan said.
The Opinions on Standardizing the Development of Off-campus Training Institutions issued by the General Office of the State Council in 2018 No. 80 clarified that off-campus training machines shall not charge a one-time fee that spans more than 3 months. For training courses that are not completed by the trainees, the refund matters shall be handled in strict accordance with the contractual agreement between the two parties and relevant laws and regulations.
Liu Chunquan believes that the national stipulation that tuition fees cannot exceed three months is a kind of balance, but the actual situation is that the prohibition lacks basis, and it is difficult to avoid the risks caused by financialization if it is not prohibited.
So, what are the pitfalls that prepaid consumption damages consumer rights?
Attorney Wang Dong concluded from the actual cases related to advance payment that the first problem that consumers are likely to encounter is that the payment is easy to refund and difficult to refund.
"When business operators sign contracts with consumers, they usually set up non-refundable or high liquidated damages for refunds. Once a dispute arises, the business operator will use this as a reason to refuse to perform the corresponding obligations." Wang Dong said.
The second is the risk of enterprises running away. "Some businesses do not provide products and services by changing the industrial and commercial registration. After absorbing a large amount of advance payments from consumers, some business operators often use some legal loopholes to transfer equity, causing the company to become a shell company and ultimately bankrupt." Wang Dong told China Business News reporter.
Many consumers pay high fees in advance through loans from financial institutions recommended by the operators, and later encountered the situation of business services shrinking or even running away. However, the financial credit treaties contain various high default clauses, and consumers still need to continue to repay the financial Loans, consumer rights have been seriously damaged.
In addition, merchants may formulate some overlord clauses when consumers apply for prepaid consumption cards. For example, membership cards can only be used by registered card holders.
"From a legal point of view, prepaid consumer cards are securities, and the holder has the right to transfer, pledge or be inherited by others. Therefore, the terms that merchants do not allow prepaid consumer cards to be transferred or used by others are not legal and violate consumers The legitimate rights and interests of the people.” Wang Dong said.
Some online education course contracts also include "no refund once the subscription is successful". Li Junhui, a special researcher of the Intellectual Property Research Center of China University of Political Science and Law, believes that this is also a typical overlord clause and should be deemed invalid. Consumers who purchase services or goods online or through the Internet enjoy the "seven days without reason" right to return the goods, that is, the right to repent.
In addition, after prepaid consumption, there will be situations where merchants fail to fulfill their promises and services shrink.
On an educational forum, Song Hui, who has two treasures at home, revealed that he spent 12413 yuan to purchase GoGokid's course package in February 2019, including 144 major courses. At that time, the event was a monthly sharing poster for Moments. One lesson. However, starting from March 1 this year, GoGokid's official announcement was suddenly upgraded and changed to points mall redemption. Each major course requires 850 points to redeem, while sharing circle of friends only earns 100 points. More points need to be obtained by inviting friends to register and audition.
At this time, Song Hui carefully read the relevant terms of the contract and found that the sales commitment to him was not written in the contract; the North American 1-to-1 foreign teacher promoted by GoGokid on the official website was not written in the contract.
After many times of communication and rights protection, Song Hui told China Business News that “the organization has agreed to restore rights and interests” and that activities before March can still be carried out in accordance with the old rules.
How can consumers protect their legal rights? Wang Dong believes that the contract is the most important umbrella for consumers.
Wang Dong suggested: “As far as possible, merchants should be required to adopt a written contract (specify the subject of the contract), include the merchant’s service promotion and various commitments in the contract, read the relevant clauses carefully, and if there is unreasonable content, promptly modify it through remarks, etc. ."
Towards oligopoly
WinKey is not the only online education institution that has encountered operational difficulties this year.
According to data from Qixinbao, since January 1, 2018, the number of cancellations of online education companies across the country is 28,100, of which 25,767 are involved in business abnormalities. Beginning in February this year, the number of companies in the online education industry has soared, reaching the highest value of 2,116 in June this year.
After the outbreak of the epidemic, offline tutoring classes were forced to cease operations, creating a boom in online education, and the market demand for K12 (pre-school education to high school education) has greatly increased.
Tang Shuangshuang, chief analyst of the education industry of West China Securities, said that offline training institutions were closed under the influence of the epidemic, and education was transferred to online. In February, the online education outlet was particularly hot, reaching a penetration rate of 60%, compared with only 10 in previous years. %. The conversion rate from offline to online reaches 80% to 85%, and at the same time, the online education refund rate can reach 20% to 30%.
Why do more companies fail as the market expands?
The reason is that the rapid increase in customer acquisition costs is an important reason. Tang Shuangshuang said that the industry's average customer acquisition cost was 1,000 to 2,000 yuan per person in 2019, and this year has risen to 2,000 to 3,000 yuan per person. Consumers spend about 3,000 yuan for a semester (in a quarterly basis) course, so online education is basically at the stage of burning money.
Once a company's capital chain is under pressure and unable to recruit new sources, it is often bankrupt and run away.
Winkey founder Lin Mei'e stated in the "Apology Letter" that since 2018, major online education institutions have started a large number of market launches, and customer acquisition costs have continued to rise, coupled with the low performance during the Spring Festival in January and the foreign teacher team in December. Double the salary, the company eventually fell into a financial crisis.
As the epidemic improves, how many students are willing to stay online once offline education resumes? Tang Shuangshuang believes that after the epidemic, only 15% of students are still willing to stay in online education and training, and the online education industry will also go through a wave of waves and become oligarchic.
"Online education will develop in the direction of oligopoly. Oligopoly companies have capital to invest in customer acquisition, and the renewal rate and conversion rate are relatively high." Tang Shuangshuang said.
Faced with the unevenness of online education brands, Wang Dong suggests that consumers should do a pre-investigation when choosing an online education brand, understand the basic information of the business, and collect and grasp the operator’s residence, asset status, legal representative and main person in charge For contact information and other information, word-of-mouth reputation, operating period, shop lease period, etc., choose a reputable and powerful operator.
"Keep the payment vouchers (Alipay, WeChat, etc.) or cash receipts, contracts, merchant brochures and other materials properly, strengthen the awareness of evidence, and keep relevant payment vouchers and consumption information. In the event of damage to rights, seek timely advice from consumer protection associations in various places , The market supervision and management department (12315), the commercial department (12312) help, and through judicial channels." Wang Dong said.
(Guo Li and Song Hui are pseudonyms)
Author: Sun Weiwei