Apple Upgrade
Apple (Hacker News):
Apple today announced Apple Upgrade, a new product leasing program provided by Klarna for iPhone, Apple Watch, Mac, and iPad available on the Apple Store online, in the Apple Store app, and at Apple Store locations in the United States.
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Apple Upgrade offers 12- and 24-month leasing options for iPhone and Apple Watch, and 24- and 36-month leasing options for Mac and iPad. Leasing prices start as low as $17.99 per month for iPhone, $11.99 for Apple Watch, $24.99 for Mac, and $11.99 for iPad.
The $17.99/month gets you a base model iPhone 17e for 24 months. This is a total of $431.76 vs. $599 for buying a new one today, but then you have to make a decision:
At the end of the lease term, customers can upgrade their device to the latest generation, purchase it with a one-time payment, or simply return it and exit the program.
I used to get a new phone every other year, but I kept my iPhone 12 mini for three years and will likely keep my 15 Pro for four years. In addition to making it easier to buy phones without the up-front payment, Apple is probably hoping this will encourage more customers to get back on the two-year cycle. Given the choice between continuing a small monthly payment and getting a new phone or making a larger payment to keep their old phone, many may opt to upgrade.
The payoff amount is the difference between what was paid during the leasing period and the retail price of the device, minus any remaining trade-in credits. Klarna is not charging a fee for the leasing program, so an iPhone that’s $1,099 can be leased and then purchased for $1,099 with no extra cost beyond taxes.
I guess this means that, for a bit of hassle, you can essentially buy the device for the list price at 0% interest.
Lease participants can opt to end a lease early and return a device, but Apple says there may be “substantial fees” for terminating a lease before the end of the term.
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Customers must upgrade, end the lease, or purchase the device at the end of the lease term. If that doesn’t happen, the lease converts to a month-to-month lease for up to six months.
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Damage to an iPhone, losing an iPhone, or having an iPhone stolen could incur fees.
The rollout of the program comes as Apple has been struggling with supply chain issues related to “RAMageddon,” which refers to the industry-wide shortage of memory chips that is driving up the price of hardware. As a result, Apple recently announced price hikes for its Mac and iPad lineups, sparing the iPhone for now. The new Upgrade program seems to be Apple’s answer to making those higher prices more manageable for consumers.
Customers can manage their lease directly in the Klarna app, where they can view their billing schedule and track remaining payments.
With the launch of the new Upgrade program, Apple is discontinuing its existing in-house financing and installment programs in the U.S., which include the iPhone Upgrade Program and iPhone Payments.
For iPhones, you have to have a carrier and can’t use a prepaid plan.
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For iPads, the starting prices range from $12.99/month to $24.99/month, Macs range from starting prices of $24.99/month to $48.99/month, and the Apple Watch ranges from starting prices of $11.99/month to $47.03/month. But again, these are just starting prices. You can configure a fully loaded 16-inch MacBook Pro that is just under $230/month, and it won’t include AppleCare.
As a point of comparison, under the current program that is being discontinued, I pay $69.50/month for an iPhone 17 Pro Max, but I have a 512GB model, so my lease price for the same phone would be $40.83/month, significantly lower, but keep in mind that doesn’t include AppleCare+, which would add $13.99/month or $139/year for that iPhone. On a monthly basis, that puts a new iPhone 17 Pro Max with 512GB of storage and AppleCare+ at just under $55/month. Still a superior deal, but not nearly as good as the landing page might initially lead you to believe.
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If you lease accessories for your device, those don’t have to be returned. Why? Presumably because they have no value to Apple or Klarna.
9to5Mac can now confirm that code found in the iOS 27 beta appears to reveal a broader system for managing a financed iPhone, including the ability to restrict apps and services when payments are missed.
The code describes a system called App Managed Features, which allows an authorized financing or provider app to enroll an iPhone and perform ongoing status checks.
If the contract is no longer in good standing, Apple’s system services can place the iPhone in “Restricted Mode,” which blocks access to most apps until the payment or contract issue is resolved, while keeping a small set of apps available.
I bet there are some governments that would love to commandeer that for their own purposes.
Finally, the new framework also introduces a new type of activation lock called “Partner Finance Lock,” which is meant to prevent users from erasing, reselling, or stripping a restricted device for parts.
Previously:
Update (2026-07-29): Emma Roth:
Apple says it won’t limit the capabilities of devices leased through its new Upgrade program if you miss a payment. In an emailed statement to The Verge, Apple spokesperson Brian Bumbery says, “There will be no restricted mode and/or there will be no limitations put on device functionality due to missed payments or default with the Apple Upgrade program.”
So then what is the code that 9to5Mac found for?
One possibility is that it was developed for financing programs offered by carriers, retailers, or other partners outside Apple Upgrade, potentially including markets where device restrictions are already used to enforce installment agreements.
See also: Mac Power Users, TidBITS, MacRumors, Slashdot.
Update (2026-07-30): Ryan Christoffel:
Here’s what every eligible product costs with Apple Upgrade.
Here’s a breakdown of how much you’d pay for the devices included in the Apple Upgrade program, as well as how much more you’d pay to purchase the devices outright at the end of your lease[…]
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Klarna doesn’t say what will happen if you don’t pay the outstanding balance.
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During the lease, Klarna owns your device. You’re responsible for any damage, and will get charged a fee if you don’t return the device in “good condition.” That’s why Apple is encouraging customers to sign up for an AppleCare subscription that could drive up the cost of your lease even more.
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Apple also notes that you’ll have to pay an early termination fee if you want to return the device before your lease ends or if you want to upgrade early.
Eyes:
If you lose the leased phone you have to pay Klarna for the phone plus early lease cancellation fees.
The Apple Card Monthly Installments aren’t going away, so I’ll keep using that.
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When you finance using the Apple Card Monthly Installments, you pay a fixed amount to own your device. There are no savings here — aside from the 3% cashback — the monthly payment is the purchase price divided by either 12 or 24 months.
When you lease an iPhone through Apple Upgrade, you need a cellular account on one of the big three U.S. carriers: AT&T, T-Mobile, or Verizon. That kind of stinks, and I’m not quite sure I understand why.
Eyes:
The iPhone upgrade program always required it. For a time you could do Apple Card installments without a carrier if you bought it online but never in store. I assume there is carrier pressure to tie the phones to the carriers. Activating iPhones on carriers was a key metric at the Apple Store.
Previously:
Update (2026-08-03): John Gruber (Mastodon):
Credit-risk assessment is seemingly part of it. There’s a lot of fraud in iPhone purchases specifically and cell phone service generally. The big three carriers do a significant amount of risk assessment before letting you open a new postpaid account; that you have an active account with one of them is a signal that you’re not trying to lease an iPhone using phony credentials in order to sell it.
But the bigger reason is the complex nature of the contracts between Apple and each of the big three carriers.
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This seems fine. But it's another one of these things that start out fine, but now that it's a number in somebody's OKRs, there's an incentive to start making it more predatory.
So hardware on a subscription, but the hardware is under a form of MDM.
I don't understand any of this trickery.
WTF Restricted Mode?
Thank you for quoting that because this is the first I've heard about this aspect of it.
You're damn right that that will have implications far beyond phone financing.
I don't like anything about what this whole program implies.
I hate to be that guy but RMS and others warned us about a future where all the hardware is strictly under their control and root access is a crime.
Yes I understand that this is similar to putting GPS trackers on low budget car sales, things like that. But is that really the comparison we want to be making?
This is a thin wedge AND a slippery slope.
The Mac Studio M4 Max 64GB RAM/512 GB SSD works would be $70/month for 36 months. Which totals $2520.
Buying the same configuration would be about $3500.
Upgrading at the end of the 36 months seems like it could make sense and might even end up cheaper if you're someone who upgrades often.
Wait, are there any hints of these “App Managed Features” or “Partner Finance Lock” features in the code for the **Mac** OS 27 beta?
I think this will be good for Apple, particularly phone sales.
—All Apple Upgrade sales go through them instead of carriers;
—Apple gets to market the lower monthly costs, which may be even more valuable if component prices continue to rise, along with any devices which would have a higher up-front cost (like the expected foldable phone);
—many will likely end up upgrading after two years, so that’s to Michael’s points about no “up-front payment… [and encouraging] more customers to get back on the two-year cycle;
—while I’ve never seen churn reported as an iPhone issue, those people upgrading after two years are also a reduction in that potential outcome;
—that customer retention is worth a lot of money: between apps and iCloud and AppleCare and subscriptions, Horace Deidu used to peg this added value to Apple as $1 per day, and that number has certainly gone up;
—Apple gets more control of used products;
—the lease terms could increase AppleCare sales.
