Samsung has rolled out a monthly equated monthly installment (EMI) scheme in India, offering 15 percent cashback for the flagship Galaxy range with zero per cent financing to make its devices more affordable.
The offer is available with both ICICI Bank and Standard Chartered, according to the Times of India. Among the devices covered include the Galaxy Note 2, Galaxy S3, Galaxy Grand, Galaxy Tab 2, along with the Galaxy Camera.
Samsung has been promoting its Galaxy smartphone models through finance offers since the beginning of the year, following a similar move by Apple with the iPhone 5. Apple saw increased sales in the Indian market, following the introduction of EMI scheme with the iPhone 5.
Smartphones are still considered a high end luxury item in India. The main reason for this is because the cost of purchasing a brand new smartphone can very easily be someone's entire monthly salary. Hence, offering a cashback scheme for Indian consumers with zero percent financing is an ideal sales pitch to increase sales, and help the transition for first time smartphone consumers.
Compared to Western markets where mobile phone carriers lock in consumers on either a 2 or 3 year contract and provide a handset for free, or at a subsidized price to the customer, no such scheme currently exists with Indian mobile phone operators. Furthermore, multi-national companies (MNCs) also do not provide discounts or incentives to employees for handsets either.
However, MNCs do have arrangements and agreements with a few of the Indian mobile phone operators, primarily Bharti Airtel and Vodafone, to provide employee packages for either a pre-paid or post-paid connection. Even then, there still is no deal on a handset for consumers.
Personally, I'm surprised mobile phone manufacturers have not approached the Indian mobile phone operators to provide similar packages as available in the West.
What's more interesting is that while consumers in the West already have the disposable income to purchase the devices as required, it's still being subsidized. That's versus India where consumers still have to save up to purchase a smartphone. In my opinion, it would make more sense to have implemented 2 or 3 year contractual deals in India from the beginning. Perhaps this new approach by both Apple and Samsung is a way to target that potential market of consumers within India who need an incentive to purchase a new smartphone.