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Apple teams up with Ant Financial to provide interest free financing in China

As Apple witnesses massively declining hardware sales amid increasing competition, the Cupertino giant is coming up with yet another model to spruce up iPhone sales in its biggest global market — China. First reported by Reuters, Apple has decided to partner with Ant financial, forming a joint venture financial company. Why ? Well, in hopes of increasing iPhone sales in China where the sales have dropped drastically since the Q4 in 2018 due to heightened trade tensions between US and China, and rising home grown brands gaining prominence in the high-end smartphone market.

China is one of Apple’s most valued markets for iPhone sales and this drop in sales has allowed Apple inc. to fall in rankings down the smartphone industry. Due to this sale scare, Apple has decided to take payments in installments to a whole new level with this scheme that they have planned with Ant financial.

Under this new scheme, customers are able to pay different set amounts for different models of the newly released iPhones. Customers can pay 271 yuan each month to purchase an iPhone XR, and 362 yuan each month for an iPhone XS. Another cool new offer is allowing customers to trade in old models and get cheaper installments.

One of the more long term installment plans for customers include letting users buy products worth a minimum of 4,000 yuan worth from Apple which would qualify for interest-free financing that can be paid for over as long as 3, 6, 9, 12 or 24 months.

The 64GB versions of iPhone’s XR and XS models sell at official sticker prices of 6,499 yuan and 8,699, respectively.

Huabei, a consumer credit service run by Ant financial is acting as a medium through which Apple if offering this scheme.

Some of China’s main financial companies such as; China Construction Bank Corp, China Merchants Bank Co Ltd, Agricultural Bank of China Ltd and Industrial and Commercial bank of China Ltd also offer financing schemes for Apple products, with a requirement of minimum purchasing of 300 yuan.

Research from IDC shows a drop in iPhone shipments to China that were around 19.9% in the Q4 of 2018. Total smartphone shipments to China were also down by 9.7% during the same time period albeit, domestic brands like Oppo, Huawei and Vivo continued growing their market shares.

Apple’s revenue for its Greater China region fell 27 percent year-on-year to $13 billion in the quarter ended December. CEO Tim Cook blamed macroeconomic conditions and currency fluctuations for Apple’s overall flagging growth.

Sharpening its service side of business has been a top priority for the company after its core product — the iPhone — witnessed massive decline in sales. Not to mention, Apple has also decided to team up with Goldman Sachs for the launching of a credit card which will be paired with iPhones and help iPhone users to manage their money better and more.