Apple has reportedly teamed up with Chinese Payments firm Ant Financial Services Group and multiple local banks to offer interest-free financing on iPhone devices.
Reuters reports that Apple Inc. has struck a deal with Chinese payments giant Ant Financial Services Group along with multiple local banks as the company plans to offer interest-free iPhone financing. This sudden initiative is likely a result of the revenue warning that the company issued last month, noting weak iPhone sales in China where consumer spending has slowed due to a lack of economic growth in the country.
Apple is now promoting a new payment plan on its Chinese website where customers can pay 271 yuan ($40.31) a month to purchase an iPhone XR or 362 yuan ($53.92) to purchase an iPhone XS. If customers purchase products worth a minimum of 4,000 yuan from Apple, they will qualify for interest-free financing on their devices which can be repaid over a period of anywhere from three to 24 months.
For context, the iPhone XR sells for 6,499 yuan in China while the XS sells at 8,699 meaning both would qualify for this financing plan. The plan is offered through Huabei, a consumer credit service owned by Ant Financial Services Group which itself is the payment affiliate of Chinese e-commerce giant Alibaba.
Local Chinese banks are also offering payment plans for Apple phones. The research firm IDC found that during the fourth quarter of 2018, iPhone shipments to China fell by 19.9 percent while total smartphone shipments to the country were down by 9.7 percent. Chinese brands such as Huawei, Oppo and Vivo continued to grow market share.
Apple CEO Tim Cook blamed the economic conditions of China and currency fluctuations for Apple’s limited growth in the country after it was revealed that the company’s revenue for the Greater China region fell by 27 percent year-on-year to $13 billion in the fourth quarter of 2018.