Thousands of Australian households have failed to take up compensation they are entitled to, after telcos were ordered to refund customers whose internet speeds were found to be underperforming.

Eight companies – including big players Telstra and Optus – were found to have misled customers about the speeds possible on fibre-to-the-node (FTTN) and fibre-to-the-building (FTTB) NBN connections.

While more than 142,000 customers are entitled to a refund, only a third have contacted their providers to take up the offer, the consumer watchdog reported last week.

Affected customers were first notified about the refund in late 2017.

The Australian Competition and Consumer Commission said some affected customers weren’t even able to get half the speeds they were promised.

The retail service providers – Telstra, Optus, TPG, Dodo, iiNet, Internode, iPrimus and Commander – advertised NBN plans with maximum speeds that many consumers could never experience due to the limitations of FTTN and FTTB technologies.

Affected customers have the option of staying on the plan, moving to a lower speed plan with a refund, or exiting the contract with a refund.

“A large proportion, two in three affected consumers, have not responded to the letter or email from their RSP [retail service provider]. They may be eligible for refunds, some in the hundreds of dollars,” ACCC acting chairman Mick Keogh said.

“The ACCC is urging NBN customers to contact their NBN retailer if they have received a letter or email offer of a remedy, or think they might be entitled to a remedy.”

Customers should contact their retail service provider if they’re experiencing slow connection speeds on the NBN.

The ACCC said customers who have recently signed up to an NBN plan could also be eligible for a refund if the telco advertised maximum connection speeds.

Retail service providers must check their speeds within four weeks and offer remedies if the speeds are below those advertised.

The amount of the refund would depend on the cost of their plan and the price of a lower speed plan the customer can actually reach.

Telstra has notified 42,000 customers since late 2017 that they signed up to plans with advertised maximum speeds that couldn’t be reached in real-world conditions.

A Telstra spokesperson told The New Daily the telco had “implemented all commitments made to the ACCC and reported this information in line with progress”.

Optus advertisements misled 8700 customers about maximum speeds and also started informing them they were eligible for a refund in late 2017.

The ACCC at the time said that 48 per cent of customers on the Optus NBN plan with maximum download speeds of up to 100 megabits per second (Mbps) and uploads of up to 40 Mbps weren’t able to achieve that.

“Worryingly, many affected Optus FTTN customers could not even receive the maximum speed of a lower-tier plan. This is a concerning trend we have seen throughout the industry and we are working to fix this,” ACCC said at the time.

Optus has since bought more Connectivity Virtual Circuit (CVC) capacity to help improve speeds.

TPG said it would compensate almost 8000 customers, with 62 per cent of those on the 100/40 Mbps FTTN plan failing to get the speeds they purchased.

There were 11,000 affected iiNet and Internode customers, and 5000 on Dodo, iPrimus and Commander needing compensation.

Seventy per cent of Dodo and iPrimus customers on 100/40 Mbps plans couldn’t reach the speeds they were sold.

About 83 per cent of Commander customers on a 100/40 Mbps plan couldn’t achieve the advertised speeds.