Apple is reportedly preparing to launch a new device leasing program called Apple Upgrade on July 28. Backed by Klarna, the plan would let users lease not only iPhones but also iPads, Macs, and Apple Watch models on a monthly basis, starting first at Apple Stores and online in the United States. Positioned as a replacement for the existing iPhone Upgrade Program, it is said to broaden the range of eligible hardware while also supporting mid-term upgrades and returns.
What Is Apple Upgrade?
Apple Upgrade is a device leasing program in which the payments company Klarna provides the financial backing behind the scenes. According to reporting by Bloomberg citing people familiar with the matter, users pay a monthly fee to use an eligible device and, at the end of the term, can choose to return it or keep using it.
Apple has long offered ways to keep devices up to date through monthly payments. However, the existing iPhone Upgrade Program is, as its name suggests, centered on the iPhone, with a limited range of covered hardware. The big difference this time is that Apple Upgrade extends coverage beyond the iPhone to include select Mac, iPad, and Apple Watch models.
One factor behind the move is the rising cost of components such as memory and storage. As procurement costs climb amid growing demand from AI data centers, a leasing model makes it easier to hold down the monthly amount users pay, lowering the hurdle to picking up a device. Shorter upgrade cycles also make it easier for Apple to funnel returned devices back into circulation as certified refurbished products.
Eligible Devices and Lease Terms
Lease periods vary by device type. The iPhone and Apple Watch are expected to run for 24 months, while Mac and iPad plans last 36 months. Users pay a monthly fee and, if they wish, can pay off the plan early. During the term they can switch to a newer model, and at the end they can choose either to keep the device or return it.
On the other hand, some of these actions may incur additional fees. To use the program, users will also need to pass a soft credit check performed by Klarna.
It is worth noting that not every product is eligible. According to the reports, the Apple Watch SE, the base-model iPad, the iPhone 16, and the MacBook Neo are among the models excluded. The program is also said not to cover business or education purchases. As for availability, it is initially planned for the United States, and any expansion to other regions, including Japan, has not been detailed at this point.
How It Differs From the iPhone Upgrade Program
The existing iPhone Upgrade Program will reportedly remain available, but Apple is said to be closing new enrollments in order to shift users toward Apple Upgrade. Alongside the wider coverage, there is another important distinction: Apple Upgrade is said not to include AppleCare, which had been part of the iPhone Upgrade Program.
How coverage is handled is likely to be a consideration for anyone weighing the plan. Users who want protection against malfunctions or accidents may need to sign up for AppleCare separately.
Apple and Klarna So Far
This is not the first collaboration between Apple and Klarna. In October 2024, Klarna installments were added to Apple Pay for online and in-app purchases, letting users choose flexible payment options at checkout.
Apple shut down its own Apple Pay Later service in 2024 and has since deepened its work with third-party providers such as Klarna. In September 2025, a new pay-later option rolled out in the Wallet app across iOS 18 and iOS 26, allowing users to select Klarna as an installment provider through the same flow used to add a new card. This latest device leasing program can be seen as an extension of that steady progression.
Summary
Apple Upgrade is reported to launch on July 28 in the United States as a Klarna-backed monthly device leasing plan covering select iPhone, iPad, Mac, and Apple Watch models. The iPhone and Apple Watch come with 24-month terms and the Mac and iPad with 36-month terms, with the flexibility to switch models mid-term, pay off early, or keep or return the device at the end. However, AppleCare is not included, and some models as well as business and education purchases are said to be excluded. As component prices keep climbing, the plan looks set to add one more option for people who want to keep using the latest devices while holding down their monthly costs.
