the credit checks will be completed in store. chip and pin verification will be the only type allowed probably. you won't walk out of the door until o2 have decided to give you the contract.
Not quite sure what you mean here. Chip and Pin refers to Credit Cards, as in paying for the phone initially? Whether you can fit another £269 on your Credit / Debit Card has nothing to do with whether a company will offer you a contract you're committed to pay and could run up any phone bill with. Credit Checks are done against your Credit History and CCJs made against you etc.
When selling the iPhone in an Apple store, no contract is signed, to save time that is all done at home via iTunes which is where you could fail to be allowed a contract and get stuck with a useless phone.
I think you have the wrong end of the stick.
You goto a shop and buy the iPhone for £269. You take it home and plug it into your computer. You then select one of 3 contracts - £35, £45, £55, all 18 months. There is no PAYG option. You won't be able to use any other O2 sim card in the phone without using unlocking tools.
So at the end of the day, you paid an up front £269 in the shop, and then 18 months of at least £35. Total cost of ownership is £899. This makes the iPhone one of the most expensive phones going. The cheapest you can get it overall is £900.
My point was what happens if at the picking a contract stage you're refused a contract based on your credit history. o2 won't let anyone run up a £200 first month bill then have no ability to pay it.
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