Refurbished phones are moving beyond their traditional role as a low-cost alternative, with consumers increasingly using them to upgrade to premium devices as rising prices of new smartphones is widening the value gap ahead of the festive season.
The shift is particularly visible in the higher-priced segments, where consumers are increasingly weighing a recent-generation refurbished flagship against a new mid-range smartphone. Industry executives and analysts expect this trend to gather pace during the festive season as higher component costs are pushing up prices of new devices and leaving brands with less room for deep discounts.
At Cashify, smartphones priced above Rs 45,000 accounted for 17.4% of refurbished sales in 2025, up from 10.9% a year earlier. At the same time, 5G smartphones accounted for 61% of refurbished sales, compared with 18.4% a year earlier, while iPhones made up 65.3% of sales, with the iPhone 13 alone accounting for 15.5%.
“The refurbished market is no longer driven only by buyers looking for the lowest-priced phone. Consumers are increasingly using it to move up to a better device,” Nakul Kumar, co-founder, Cashify, told FE.
The change comes at a time when buying a new smartphone is becoming more expensive. The average selling price of smartphones in India rose 14.4% year-on-year to a record $315 (around Rs 27,700) in the June quarter, according to IDC. Prices of nearly 95% of smartphone models increased between January and July, industry analysts said, with Apple being the only major brand that did not raise prices on its existing models.
The prospect of less aggressive festive discounting could further alter the equation. Brands and retailers have spent much of the year protecting margins by reducing discounts, while higher memory and component costs are limiting their ability to absorb further increases. IDC expects affordability pressures to intensify in the second half as lower-cost inventory gets exhausted.
For a consumer looking to spend Rs 20,000-45,000, the choice is therefore changing. Instead of buying a new mid-range phone, a buyer can opt for a relatively recent refurbished flagship offering better cameras, processors and other specifications.
“At this price point, the consumer has a clear choice: buy a new mid-range phone or get a recent-generation refurbished flagship with better cameras, processors and overall performance. Increasingly, we are seeing consumers choose the second option,” Kumar said.
The broader secondary smartphone market is already expanding. Secondary devices now account for roughly one in five smartphones sold in India, compared with around 12% in 2021, industry executives estimate. Refurbished smartphone volumes rose 13% year-on-year in January-June even as new smartphone volumes declined around 11%, according to Counterpoint Research.
Counterpoint expects the refurbished market to grow 16% in 2026, with festive trade-ins and new flagship launches bringing more recent-generation devices into the secondary market in the second half.
The trend is also visible at the lower end, but in reverse. Sub-Rs 10,000 phones accounted for 8.4% of Cashify’s refurbished sales, down from 10.7% a year earlier, suggesting that demand is gradually shifting towards higher-value devices. IDC expects shipments of sub-$100 (around Rs 8,800) smartphones to fall more than 80% in 2026 as higher component costs put further pressure on affordability.
The key constraint could be supply. If higher prices encourage existing users to hold on to their phones for longer, fewer devices could enter the trade-in channel. Industry executives, however, expect festive upgrades to generate enough trade-ins to prevent a broad shortage, although availability of some recent-generation models could tighten.