Apple Lets Chinese iPhone Buyers Pay in 2-Year Monthly Instalments

apple-store-chinaIn an attempt to better compete with low-cost Android manufacturers in luring the middle class Chinese market segment, Apple is offering financing plans to Chinese buyers, letting them pay the hefty price of an iPhone over a period of 24 months with interest rates as low as 0 percent.

The financing plans, as detailed on Apple’s China website, are valid for purchases of any Apple product ranging from 300 yuan ($48) to 30,000 yuan ($4800), and require a China Merchants Bank credit card. Buyers have to option of splitting their payments into periods of 3, 6, 12, 18 or 24 months. An interest rate of 8.5 percent is applicable for a period of 24 months, 6.5 percent for 18 months and for 12 months or below there’s no additional fee. Apple notes that a buyer’s application for the financial plan will examined and approved by the bank, only after which the financing can be availed.


Although Apple is doing pretty well in terms of absolute numbers in China, selling two million iPhones in just three days, on a marketshare basis, it’s way behind the competition in the region. Research firm IDC’s stats rank Apple at the sixth position in China, behind ZTE and Lenovo, and down from its fourth position last quarter.

Analysts, speaking to Bloomberg, note that Apple’s already achieved maximum penetration among China’s affluent class, and the next frontier is cracking the middle-class market, where a huge potential of growth lies. The average urban Chinese citizen earns 3,585 yuan monthly and the price of an iPhone 5 in the region starts from 5,288 yuan.

While Apple works on readying a low-cost iPhone, financing plans like these will surely help the company reach out to a broader audience, although not to the same extent as its competitors, who have devices across the entire price spectrum.

Apple offers similar payment methods in countries like the US, Singapore and Brazil, but the plans in China feature a lower applicable price and longer periods. The company has, on several occasions, iterated the importance of the Chinese market for future growth. Most recently, Apple CEO Tim Cook and Marketing head Phil Schiller were in the country to meet government officials and talk to China Mobile, the world’s largest carrier, which still doesn’t carry the iPhone.

Would such financing plans convince you to buy the iPhone as opposed to cheaper Android smartphone?

Via Bloomberg, Financial Times

Image via: Apple

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