For better or for worse, all industries go through significant changes over time. Businesses encounter new challenges and opportunities every year, and the device financing industry is no exception. As an evolving practice, device financing is influenced by multiple modern factors and trends. Telecom carriers and resellers must stay up to date with these dynamic trends to navigate upcoming challenges, seize opportunities, and develop relevant and innovative financing solutions.
In this article, we delve into the leading trends that are shaping device financing in 2024.
Top 5 device financing trends for 2024
Trend 1: Broadscale Demand for 5G
The adoption of 5G is surging worldwide. In 2023, the number of 5G connections exceeded the 1.5 billion mark. According to a study1 analyzing the progress of 5G, these connections are projected to surpass 3.6 billion by 2025. 5G’s vast network capacity, lower latency, and consistent performance drive this broad-scale adoption. Its high speed and bandwidth allow businesses to leverage IoT devices for fast data transfer and ensure a uniform user experience. This rapid expansion marks the beginning of 5G’s transformative benefits for all use cases.
With the growing prevalence of 5G in personal and professional ecosystems, communication providers should gear up for a massive influx of new 5G-enabled devices. They must develop dynamic pricing plans to support and boost the 5G proliferation in devices.
Trend 2: Strong Consumer Preference for Flexibility and Freedom
Today, one device is used for a wide range of purposes. Everything can be done on a smartphone, tablet, or laptop, from scrolling content to handling bank transactions. With such diverse functions, consumers want the flexibility of using their devices anywhere, anytime, and however they prefer. They are not particularly fond of restrictions put on their device usage that hinder one or more of their tasks. Hence, device financing platforms need to come up with solutions that ensure security and risk management with minimal interference to the consumers’ devices.
Large amounts of personal and sensitive data are also stored on these devices. Excessive control over financed devices can lead to consumers’ concerns about their data privacy. Resellers and telecom carriers should focus on balancing the security of leased devices and maintaining their privacy and personalization.
Trend 3: Increased Frequency and Severity of Device Misuse
As mobile devices become the primary repository for all personal and business data, they are more susceptible to theft and loss. Stolen devices are used to access private and financial information to commit identity theft, financial fraud, and other illicit activities.
In 2023 alone, 4 million phones were lost or stolen, causing significant damage2. With theft instances on the rise, securing financed devices is vital for communication providers. Onboarding them on a DFRM platform is a reliable way to protect all types of devices. These platforms allow resellers to remotely lock the leased smartphones, laptops, tablets, etc., to prevent unauthorized access and data breaches.
Trend 4: Shift from Traditional Ownership and Financing Models
Consumers are rapidly transitioning from traditional ways of buying and owning devices. They now prefer installment-based purchase plans, subscriptions, and buy now pay later (BNPL) schemes instead of one-time payments.
The share of smartphone purchases with no-cost EMI plans accounted for 33% of all transactions in 20233. This underscores the need for telecom operators and communication providers to offer monthly installment-based payment options and flexible pricing plans. It will help them cater to the changing consumer demands and stay ahead of the curve in the dynamic market.
Trend 5: Growing Awareness of Credit Scores
Financial literacy is growing among individuals, especially the modern generation. A survey4 revealed that 93% of millennials (aged 18-34) in a study were aware of their credit scores, significantly higher than other age groups.
The value of credit scores in availing home loans, car loans, renting apartments, and other facets of personal finance is coming to light. This has resulted in people seeking new opportunities to build their credit scores from an early age. In this context, device financing emerges as a key opportunity. It can help improve a consumer’s creditworthiness by establishing a consistent payment history and improving their overall credit profile.
Embrace Device Financing Trends with NuovoPay
Device financing is going to witness a new dimension of opportunities and shifts this year.
Resellers and telecom carriers must embrace these emerging trends to benefit from the evolving nature of the market. They need to mold service offerings according to consumer preferences and recent technology developments.
As device usage continues to rise and diversify, securing them from theft and loss is also essential. A secure DFRM platform can be instrumental in providing this protection. It can also be a reliable way to ensure consistent repayment and appropriate use of the financed devices.
With an eye out for these trends, industry players have valuable opportunities to achieve success in the market in 2024. A DFRM platform like NuovoPay can help you stay in sync and ride the device financing trends and tides!
References:
1. CCS Insight
2. Asurion
3. Business Standard
4. CNBC
