Being able to buy a smartphone and pay in installments has obvious benefits. The most glaring is that it helps you purchase the latest phones without stretching your cash flow thin. In other words, you do not have to empty your pocket or bank account in order not to miss out on new devices.
It is a way of making phones affordable for more people. The flip side is that you have to pay an interest on the selling price of the phone, so you end up paying more at the end of the day. However, it is a win-win for both buyer and seller.
Buying a smartphone on an installment plan is becoming more essential as the prices of smartphones go up. Manufacturers are improving on their products and adding more cutting edge features to them. The consequence of this is that prices also go up. The current crop of 2020 premium flagship smartphones, for example, are hitting the range of $1,000.
What is an installment plan?
Paying in installments means splitting up the payment for a device from one bulk sum to smaller multiple amounts. So, a 2-month instalment plan means that the payment is spread across two months, while a 6-month installment plan means that the payment is spread across 6 months. An installment plan is a credit-based transaction.
This is called financing in some countries, e.g., the US. You will find it called “pay small small” in Nigeria, Ghana, and other countries in Africa.
What is an example of an Installment Plan?
For example, instead of paying the full price for an iPhone 13 Pro Max one time, you can get it on a contract or installment plan and pay as little as $100 monthly for between several months. Depending on the details of the financing or credit scheme, the monthly payments can be spread over as many as 24 months.
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