Apple Launches Klarna-Backed Leasing Program, Ending iPhone Upgrade Program Enrollments
Introduction to Apple Upgrade
Apple has introduced a new leasing program called Apple Upgrade, with support from Klarna. This program allows customers to lease devices such as iPhones, iPads, Macs, and Apple Watches. At the same time, Apple is ending new enrollments in its long-running iPhone Upgrade Program.
With this new option, users have more ways to upgrade their devices. However, it raises a critical question: does the new lease save money for Apple users? Whether it is beneficial depends on customer priorities. The new lease offers lower advertised monthly payments, but Apple has adjusted the packaging of some benefits.
Understanding Apple Upgrade
Apple Upgrade is a leasing option that lets customers pay a monthly fee for a new iPhone, iPad, Mac, or Apple Watch through Klarna. Depending on the product, users can select different lease terms. At the end of the lease, options include upgrading to a newer device, purchasing the device outright, or returning it to exit the program.
The program is accessible online, through the Apple Store app, and at Apple retail locations throughout the U.S. Applicants will undergo a soft credit check, which does not impact their credit score.
This launch signifies the cessation of new sign-ups for the iPhone Upgrade Program. That program allowed users to finance an iPhone over 24 months and be eligible for an upgrade after 12 payments.
The rollout happens as Apple transitions its leadership. Tim Cook will transition to executive chairman, with John Ternus becoming CEO on September 1, 2026. Apple Upgrade is one of the first significant consumer initiatives unveiled during this leadership change.
Comparing Apple Upgrade and iPhone Upgrade Program
For customers upgrading iPhones annually, the monthly cost is a crucial factor. Apple’s pricing shows that Apple Upgrade leases are about $11 less per month for the iPhone 17 Pro Max lineup compared to the former program.
Reasons for Lower Costs
The previous program included AppleCare+ with Theft and Loss in the monthly payment. Under the new lease, this coverage is not included by default and must be purchased separately. Reports suggest that AppleCare+ with Theft and Loss for current Pro-level iPhones costs approximately $13.99 per month, or $139.99 annually. Therefore, the savings boasted in Apple’s lease pricing is mostly nullified once similar coverage is added independently.
End-of-Lease Options
Ownership is another key distinction. Previously, with the iPhone Upgrade Program, customers financed devices over 24 months, owning them after making all payments. Current program members can continue to do so until their devices are fully owned.
With Apple Upgrade, products are leased through Klarna. At the term’s end, customers can choose to buy, return, or roll into a new lease. Apple also suggests reducing payments by trading in devices during enrollment and notes the possibility of earning 3% Daily Cash with payments via Apple Card.
Apple’s Perspective
Apple’s objective with the new program is to provide customers with greater flexibility and extend upgrade options beyond just the iPhone to include Macs, iPads, and Apple Watches. Lease pricing begins at $17.99 for iPhones, $11.99 for Apple Watches, $24.99 for Macs, and $11.99 for iPads.
Newsweek is awaiting a comment from Apple after reaching out via email.
Conclusion
For annual iPhone upgraders, Apple’s new lease seems approximately $134 cheaper each year, according to advertised monthly payments. However, the savings vanish if factoring in the absence of AppleCare+ with Theft and Loss, once included in previous plans. Therefore, the most significant change might be the model shift from financing with included protection and ownership to leasing, focusing on flexibility and continuous upgrades.