Leap Wireless and MetroPCS, both smaller prepaid carriers, are starting to offer handset financing programs for their devices. One of the issues facing carriers that only operate on a prepaid basis is the high up-front cost of handsets. Even though the customers will be saving lots of money in the long-run, the $500 or more required to buy a high-end device may turn some away.
Leap, which operates the Cricket Wireless brand (which is somewhat confusing,) started offering its financing plans a couple weeks ago and now have them rolled out to all of its stores nationwide. Purchases of $200 or more -- both phones and accessories -- can qualify for financing of up to 90-percent of the purchase price. If the loan is paid off within 90 days, there are no fees or interest charges as well. This means that someone buying a device that is normally $500 will be paying just over $100 out the door for the device and the first month's service paid in full. MetroPCS wouldn't comment specifically on its financing plans, but intends to launch a similar setup of handset financing to its customers very soon.
Even with the financing plans, neither Leap nor MetroPCS will require a contract for its services and will remain completely prepaid. Both operators aren't requiring a credit check for financing either -- just an active bank account -- which is a big deal to many customers. Anything that can help users make the choice on going to prepaid to save money on their cellphone service is a good thing.