Enabling Powerful Smartphone Subsidies

India’s feature phone shipments grew faster than smartphone shipments for the very first-time in 2018 thanks in part to an innovative finance program

According to the latest research from Counterpoint’s Market Monitor service, in 2018, India’s overall mobile phone shipments grew 11% and smartphone shipments grew 10% with feature phones growing faster than smartphones (11%) during the year for the first time ever, driven by the Jio Phone. Reliance Jio was the overall market leader across all handset types in 2018, with a market share of 21% and captured 38% of the feature phone segment in just over a year with its compelling value proposition compared to normal 2G feature phones. This was also recently covered in the WSJ.

Source: Counterpoint Research Market Monitor 2018

Reliance Jio’s compelling value proposition

The JioPhone was launched in July 2017 by the Indian mobile network operator Reliance Jio and was the first affordable 4G VoLTE smart feature phone, powered by KaiOS. The JioPhone, introduced as “India ka Smartphone” was launched at a so called “effective price” of Rs. 0 ($0). However, this was not exactly true. Consumers had to pay a security deposit of Rs 1,500 ($21.60) which was refundable if they returned the phone in 3 years and only if they paid for a Reliance Jio plan during the 3 years. Total cost to the consumer was Rs 6,000 ($86.40) or Rs 4,500 ($64.80) if the device was returned so certainly not free! Reliance Jio has certainly created a compelling value proposition that has been profitable for the company and gotten consumers access to the products they want. According to Counterpoint, half of the more than 100 million subscribers added since the launch of the JioPhone was thanks to this feature phone. Reliance Jio has changed the mobile economy in India by essentially creating a Post-Paid for Pre-Paid plan that tied customer loyalty to the mobile network operator.

The challenge in extending credit in emerging markets

The fundamental challenge mobile network operators or any company for that matter has in extending credit in emerging markets to purchase a smartphone – is the lack of collateral and underwriting data which is why Reliance Jio requires a security deposit and offers the lowest cost 4G handset possible. Mobile network operators would do better if they were able to find a way for consumers to pledge their smartphone as collateral. This would allow mobile network operators to offer better smartphones with little or no security deposit or perhaps even subsidized if the consumer agreed to a minimum mobile service recharge rate per year.

Extending credit by leveraging innovative technologies

PayJoy gives mobile network operators and finance companies a tool to collateralize smartphones that aren’t just the lowest cost phones. With our patented Lock technology, which resists any efforts to be deleted from the mobile device until the subsidy is recovered, we can increase recharge repayments and minimize the risk of late or defaults. We have developed a user experience on our lock that helps customers to track and make their recharge payments seamlessly via the app. When users are late on a recharge payment, they don’t get charged any late fees. Instead the PayJoy Lock limits their app and call functionalities until they make their recharge payment, and instantly restores normal phone functionalities. Through this new “Recharge” form of device subsidy that mirrors the “pay as you go” solar distribution model, we enable users to afford getting a smartphone by using it as collateral, and we enable operators to onboard the next billion users to smartphones and full connectivity.

A New Model Powered by PayJoy

Below is a sample of the kind of model that could be powered by the PayJoy Lock.

5.5″ Full View display
5MP rear camera, 5MP Front Camera
1GB RAM, Quad-Core Processor
Android™ 8.1 (Go edition)
Standard unlocked price: $80
PayJoy Locked price: $30
Recharge: $4.5/1.5GB for 12 months

For more information, visit www.payjoy.com. Join the smartphone financing conversation by visiting the PayJoy blog, Twitter, LinkedIn and Facebook pages.

Written by Dominique Friedl, GM PayJoy Africa and Jenny Jin, Senior Product Manager

PayJoy Gets an Astounding 80 NPS in Mexico

A Net Promoter Score (NPS) helps companies measure customer satisfaction. The proponents of NPS argue that NPS is directly related to revenue growth and profitability. Considering that keeping existing customers is 25 times cheaper than getting new ones, maintaining an above industry average NPS is indispensable to sustained growth.

PayJoy Mexico — where unlike our other markets we originate on our own balance sheet — carried out an SMS campaign last week among 5,000 randomly selected customers who used us for smartphone financing in the past 12 months. We asked a simple question:  “Based on your experience with us, from 0 to 10, how likely are you to recommend PayJoy?” We received 396 responses and calculated our score from there.  You can see the details of our methodology and results below:


  • From all customers that had purchased a smartphone using PayJoy, the company randomly selected 5,000 of them.
  • The company asked: Based on your experience with us, from 0 to 10, how likely are you to recommend PayJoy?” 
  • Out of 5,000 randomly selected customers, 53 were no longer in service.
    From those 4,947, we received 396 answers and 41 were not considered due to lack or invalid response, mostly, non-numeric responses.
  • 10 and 9 were considered promoters, 8 and 7 passive and 6 to 0 detractors.
  • The calculation was: Promoters (as a % of total) – Demoters (as a % of total) x 100.
  • If the response was not 0 to10 the answer was not considered (51)
  • Conclusion: Based on our sample and the responses we received “we are 96% confident that our NPS of 80 represents the true population mean (for customers that obtained a smartphone finance by PayJoy).

The final NPS calculated — 80 –means customer satisfaction is considered, by many, world class.  As a benchmark, in Mexico, financial services averages an NPS of 46, while Telecommunications averages 24 and banking averages 37 per CustomerGauge.  83% of people trust recommendations from people in their inner circle per Nielsen, so this also contributes significantly to PayJoy’s growth.

PayJoy’s mission is to provide access to consumer finance to the next billion people worldwide. Mexico, as its first international market and the only one where it originates on its balance sheet, is key to enable PayJoy’s mission since it spearheads initiatives to ensure the products can be launched elsewhere worldwide.

We are very excited to know our customers are happy with our solution. That being said, we are continuing to work on many initiatives to improve our customer experience and give our customers more access to financial products” said Juan Jose Ocariz, PayJoy’s Mexico Country Manager.