Apple retires iPhone Upgrade Program, launches Klarna-backed replacement

Apple ↘ 0.80% has quietly retired one of its most popular retail programs, ending new enrollments in the decade-old iPhone Upgrade Program and replacing it with a leasing model called Apple Upgrade, powered by financial partner Klarna ↘ 5.34%.

The new program, which launched on July 28 in the United States, expands device financing beyond iPhones to cover Macs, iPads, and Apple Watches. But while Apple advertises lower monthly payments, customers seeking the same level of protection they previously enjoyed will end up paying more.

Lower Sticker Price, Higher Total Cost

Apple Upgrade advertises monthly payments starting at $32.99 for the iPhone 17, down from $42.41 under the old program. However, that figure covers only the device lease — AppleCare+, which was previously bundled in, must now be purchased separately for $11.99 per month.vietnamnet+1

With both costs combined, the actual monthly payment rises to $44.98. Over the first 12 months — the typical upgrade window — customers pay $539.76 under Apple Upgrade compared with $508.92 under the former program, a difference of roughly $31.vietnam+1

"At Apple, we put the customer at the center of everything we do, and we're thrilled that Apple Upgrade offers our customers, both online and in-store, a more flexible way to pay for the products they love," said Karen Rasmussen, Vice President of Apple Store Online, in the launch announcement.analyticsinsight

How the New Program Works

Under Apple Upgrade, Klarna conducts a soft credit check that does not affect credit scores. Customers choose 12- or 24-month terms for iPhones and Apple Watches, or 24- or 36-month terms for Macs and iPads. At lease end, they can upgrade to a new device, return it, or pay a one-time fee to keep it. No security deposit is required, and Klarna charges no late fees, though leases are terminated after three consecutive missed payments.financefeeds+1

Monthly payments start at $17.99 for iPhone, $11.99 for iPad and Apple Watch, and $24.99 for Mac, with costs varying by model and term length.biz.chosun+1

Strategic Context

The launch comes amid rising component costs. Apple CEO Tim Cook described memory price increases as a "100-year flood" during the company's most recent earnings call, and Apple has already raised prices on Mac and iPad lines by several hundred dollars. With a foldable iPhone expected this September at a price exceeding $2,000, the leasing model reframes large purchases as manageable monthly costs.resource-recycling+2

Existing iPhone Upgrade Program members can continue their current plans until they complete 24 payments or choose to upgrade. For everyone else, Apple Upgrade is now the only direct financing option from the company.vietnamnet