Yes, but let’s just say you got a 1200 device and only made the first two payments… jump to another carrier and abandon the one with the finance plan. What’s the recourse for the carrier?
There's a reason carriers pull credit reports for post paid accounts and 'free' phone promos right?
Although, personally, I prefer to be on the prepaid side of the carrier. I'm not getting a promotional phone, and I'm not paying for it in my monthly rate, so if my phone works for more than two years, I'm saving money. And I don't really need to use secret handshake financing... I'd rather pay $17/month for my plan and pay for a phone when I need it.
That said, T-Mobile tried being the 'uncarrier' and charging fairer prices for service and financing phones directly, and it must not have worked as well as carrier norms because they reverted to secret handshake financing.
This has a loss rate of around 70-80% across the collections industry, which is an extremely strong disincentive to go this route since it's just highly inefficient. The high cost of the collections process is a deadweight loss upon all society.
T-Mobile still finances phones directly and equipment payment plans are clearly separated out from service charges
What's the recourse for the lender?
Ford got a patent for the idea.
Subprime auto lenders use “electronic devices to remotely shut down vehicles” [1].
Carriers could install remote management profiles on phones financed for subprime borrowers. If a borrower defaults, the loan is sold to a collector and phone erased and put in lost mode.
It isn’t pleasant. But neither is being locked into a phone plan you don’t want.
[1] https://www.bostonglobe.com/business/2017/03/14/car-lenders-...
Also you can still get the phone unlocked without the carrier anyways if you really want to so it would not deter anyone who really wants to run off with the phone anyways.
It's messy and expensive, but perhaps it should be messy and expensive.