Buying smartphones and other smart devices in instalments through mobile operators will become more complicated in Lithuania from November 20, when new European Union rules introduce stricter creditworthiness checks. Customers unable to pay the full price upfront may increasingly turn to device rental or other financing options.
Under the changes, people seeking to buy phones or other telecommunications equipment in instalments through mobile operators will undergo financial assessments similar to those required when applying for other types of credit.
Currently, about seven in 10 customers buy phones and other smart devices from operators using instalment plans. The new requirements are expected to affect how these purchases are financed, with licensed credit providers becoming involved in the process.
“When buying a phone or other telecommunications equipment in instalments through an operator, customers will have to sign a credit agreement, which was not previously required,” said Asta Buitkutė, head of public relations at Tele2 Lithuania. “For this, we will need to work with a licensed partner that already has creditor status.”
The new system will require providers to check customers’ existing financial commitments and determine whether they can afford additional payments.
Jaunius Špakauskas, head of corporate communications at Bitė Lietuva, said customers could expect the purchasing process to take longer.
“In practical terms, it means I will spend a little more time in the store because they will have to check my creditworthiness,” he said. “And when we feel the impact on our wallets, smartphones will become almost a luxury item for some people.”
Rental and alternative payment options
The changes have prompted concerns among consumers who rely on instalment plans to spread the cost of new devices over time.
Some residents of Vilnius said they might have to save up and pay the full price upfront rather than go through the more complicated financing process.
One woman said instalment plans had been particularly convenient for families buying phones for their children. Parents could purchase newer models for their children and then use the older devices themselves, sometimes financing the purchases through successive instalment agreements.
Others questioned whether the changes would make smartphones less affordable, noting that the devices were essential for everyday communication and work.
Customers who cannot afford their preferred model upfront may have to choose a cheaper phone or consider renting a device instead.
Audrius Stasiulaitis, a spokesman for Telia Lietuva, said rental arrangements could allow customers to pay for a device for a year before switching to a new one.
Another option would be a residual-value arrangement, similar to financing used for cars.
“This means that you pay a certain amount in instalments for a couple of years and then decide whether to buy the device or leave it,” Stasiulaitis said.
Operators promise prices will not rise
Mobile operators acknowledge that the new rules could frustrate some customers but say they will continue offering ways to access smartphones at different price points.
Tele2's Buitkutė said phones would remain available at a wide range of prices, from about 200 euros to more than 1,000 euros.
“There will always be good offers, and we will continue arranging those offers so that customers are not left without phones,” she said, describing smartphones as an essential means of communication.
Špakauskas said smartphones had become indispensable for education, work and staying in touch with family and friends, making the changes particularly significant.
Stasiulaitis said customers would still have several ways to obtain devices, even if the arrangements and terminology changed.
Operators do not expect the new requirements to increase device prices.
The timing is a concern for some consumers who have already planned to buy smartphones for relatives as Christmas gifts. Some residents of Vilnius said they would now try to complete their instalment purchases before the new rules take effect on November 20.
LRT English
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