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Cricket now allows customers to finance handsets

One of the biggest drawbacks to prepaid wireless services is the high cost of the phone itself. Cricket customers, for instance, pay $550 for a new iPhone 5, while Verizon customers pay only $200. Yet in the long run Cricket customers will save more: $1,870 over a two-year span, compared to a minimum of $2,360 with Verizon (with a comparable plan costing more than $2,500). Still, that hefty up-front payment can be a hassle, or impossible for some customers. That’s why many current and prospective Cricket customers will be happy to hear that they are now offering financing for new handsets. Best of all, it will not require a credit check.

This is a risky endeavor for the company behind the financing, Progressive Finance. They’re giving out loans to people with nothing more than access to an active bank account. But customers will certainly jump on this, if only to unburden themselves from that hefty up-front payment.

Customers who pay off their loans within 90 days pay no finance charges, which is a big boon to customers. Continuing the iPhone example, the customer can break it down into three monthly payments of under $200 and still get the phone for $550. Interest kicks in after 90 days, and customers have nine months to pay off the entire balance.

MetroPCS also offers handset financing, through Progressive and one additional company. They have not provided details, and so customers will have to visit authorized MetroPCS dealers to find out details for themselves.

Handset costs have been, and will continue to be, a hindrance for prepaid users. MetroPCS in particular has done a good job of bringing in a number of affordable handsets, but the best handsets will always cost a premium. With financing Cricket and Metro have found ways to offer handsets such as the iPhone and the Galaxy S III on affordable terms.

Via FierceWireless.