Cell Phones

Virgin to Launch Smartphone Financing, Axe Subsidies

  • Last Updated:
  • May 5th, 2020 12:30 pm
[OP]
Deal Addict
Feb 28, 2012
1026 posts
1683 upvotes
Alberta

Virgin to Launch Smartphone Financing, Axe Subsidies

https://www.iphoneincanada.ca/carriers/ ... -financing

Bell-owned Virgin Mobile appears to be next to launch smartphone financing and axe its subsidy model, starting on May 12, 2020.

According to internal documents, the new financing model will be called ‘Sweet Pay’. Financing will allow customers to pay off a smartphone over 24 monthly payments with a 0% annual percentage rate (APR).

Virgin Mobile’s documentation says the debut of Sweet Pay will replace the existing subsidy structure. With financing, customers will be able to see separate payments for paying off a phone, separated from wireless costs.

After the device is paid off after 24 months, the financing charge is gone and customers just pay their monthly wireless cost.

Like other wireless carriers, various smartphones will be available for $0 upfront, while more expensive phones will require an upfront payment to ensure manageable monthly financing costs.

Virgin Mobile’s parent company, Bell, launched its device financing option called SmartPay last July. Back in January, Rogers and Fido moved to smartphone financing models only, ending its subsidy model. Only Koodo and Freedom Mobile still have subsidy models remaining...
5 replies
Deal Addict
Oct 14, 2015
1127 posts
1115 upvotes
Toronto, ON
There was never a subsidy model, the phone price was all baked into the plan prices. Instead of $100 per month, now you only have to pay $60+$40 now, lol. I suspect they are doing this because of the Liberal government's 25% discount on phone plans program.

With this model, you get 25% discount on the plan (i.e. $60-25%) but no discount on the phone because it is separate from the plan.

Wireless telcos are not stupid but they are making us look like fools that we can't notice.
Koodo $40 13GB!
Deal Addict
May 5, 2008
1909 posts
617 upvotes
pjw918 wrote: https://www.iphoneincanada.ca/carriers/ ... -financing

... Only Koodo and Freedom Mobile still have subsidy models remaining...
Koodo Subsidy means that infamous "phone subsidy"
which they introduced only last August and are now probably
biting themselves in the butt repeatedly because of that?
Yeah, sure it was a genious decision :)
[OP]
Deal Addict
Feb 28, 2012
1026 posts
1683 upvotes
Alberta
Perhaps more clearly explained by Mobilesyrup:

The documents indicate that Sweet Pay will replace Virgin Mobile’s existing plan tier structure. Currently, Virgin customers can get a phone at a reduced upfront cost but must pick between a Silver, Gold, Platinum, Diamond or Diamond Plus plan. As you move up the tiers, the monthly cost of each plan increases to cover the device subsidy.

While the documentation isn’t clear, it appears that after May 12th, customers will pick from the equivalent of Virgin Mobile’s bring your own phone (BYOP) plans.
Deal Addict
Dec 20, 2015
3299 posts
1637 upvotes
Toronto, ON
pjw918 wrote: Perhaps more clearly explained by Mobilesyrup:

The documents indicate that Sweet Pay will replace Virgin Mobile’s existing plan tier structure. Currently, Virgin customers can get a phone at a reduced upfront cost but must pick between a Silver, Gold, Platinum, Diamond or Diamond Plus plan. As you move up the tiers, the monthly cost of each plan increases to cover the device subsidy.

While the documentation isn’t clear, it appears that after May 12th, customers will pick from the equivalent of Virgin Mobile’s bring your own phone (BYOP) plans.
If I'm understanding this correctly, all you're doing is paying off the price of the phone in installments of 24 months and with 0% APR which is like paying in cash. I'm guessing this will allow the carriers to keep the monthly price at a norm for the plans.
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Jr. Member
Nov 5, 2011
104 posts
54 upvotes
Yes, instead of including the financing of the phone in the monthly plan, they are now separating the financing and the monthly plan, which will make things a lot less confusing for the consumer (no need for all these different tier plans). Every companies are moving to this model.

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