Apple Upgrade: Klarna-backed leasing program launches in the US

Apple has officially launched Apple Upgrade, a new leasing program in the United States that covers iPhones, Macs, iPads, and the Apple Watch. This program replaces the previous iPhone Upgrade Program and iPhone Payments options across all US retail channels. Pricing for the new leases starts at $11.99 per month, though specific costs vary by device and lease duration.

The program offers 12 and 24 month terms for mobile devices, while Mac and iPad users can choose between 24 and 36 month cycles. Apple manages the credit checks through Klarna, and the company notes that these checks do not impact credit scores. Once the lease term concludes, users have three choices: upgrade to a newer model, pay the remaining balance to own the hardware, or return the device to exit the program.

While this scheme lowers the initial financial barrier to entry, there are trade-offs to consider. The hardware remains property of the financing provider unless the customer pays the balloon payment at the end of the term. Additionally, while AppleCare is optional, it is recommended because the lessee is responsible for the device's value throughout the contract. If a device is damaged or stolen, the user remains liable for that depreciation.

Recent speculation regarding a restricted mode for missed payments surfaced due to code found in the iOS 27 beta. However, an Apple spokesperson has denied these claims, stating that the company will not restrict device functionality or implement a restricted mode for missed payments under the Apple Upgrade program. It is currently unclear if or when this program will expand to other countries beyond the United States.