Freemium mobile games aimed at children need to be subject to stronger guidelines, the Australian Competition and Consumer Commission (ACCC) said.

The watchdog examined more than 340 mobile games on Google Play and Apple’s App Store and found many freemium titles likely to be played by children do not make associated costs clear enough.

Many free to download games offer users the ability to pay for various services and content such as upgraded membership, virtual currencies — in the form of coins, gems or fruit — and new levels or features.

Less than 25 per cent of the titles on one of the app stores studied disclosed that in-app purchases could be made.

Delia Rickard, ACCC deputy chair, added that while many games tell users they can make faster progress by making in-app purchases, children “won’t always connect a tap on the screen in the heat of the action with spending their parents’ money in the real world”.

In addition, slightly less than 20 per cent of games across both platforms included information about how to set up devices to avoid inadvertent in-app purchases.

“While there are some optional tools available to parents to restrict purchases, the ACCC and consumer regulators across the globe are looking together at whether people really know what to expect before the game is downloaded,” Rickard noted.

The research carried out by the ACCC also suggested potential for “misleading and deceptive conduct in the promotion of apps” and a lack of disclosure of key terms and conditions associated with using apps.

Many games reviewed failed to provide access to terms and conditions prior to users downloading or playing games, meaning parents and children may not be aware of the suitability of content, third party collection of personal information or social sharing available within apps.

The ACCC said it supports a set of recommendations for the development of apps for children put forward by the UK Office of Fair Trading in September.

These include consumers being told up front about any possible in-game costs or advertising; the prominent disclosure of important terms prior to download; and the requirement for informed consent from an account holder or parent for payments to be made.

For its part, the ACCC said it will take enforcement actions where there have been contraventions of Australian Consumer law but also urged app developers and operators to address concerns about app-based games.

In March, Apple settled a lawsuit filed by a group of parents claiming that the App Store purchasing policies allowed children to spend large amounts of money too easily when unsupervised. The company subsequently flagged freemium apps with in-app purchasing functionality to alert parents, before introducing a Kids category to its App Store.