Bloomberg has reported that Apple plans to launch a device leasing program called "Apple Upgrade" in the United States on July 28, 2026, with Klarna as its financial partner. The program would cover Apple's four main product lines and could be signed up for both at Apple retail stores and online. Under the current iPhone Upgrade Program, once you finish paying off a 24-month 0% loan, the device becomes yours. If the new program is introduced as reported, the numbers buyers compare would shift from monthly payments to total contract cost and what's owed at the end of the term.
24 Months for iPhone, 36 Months for Mac
According to Bloomberg, the lease term would be 24 months for iPhone and Apple Watch, and 36 months for Mac and iPad. A soft credit check, which doesn't affect your credit score, would be used during sign-up. Users could pay off the balance early or upgrade to a new device ahead of schedule. At the end of the term, they could either keep the device or return it. Some procedures are expected to incur additional fees, though which actions trigger fees and how much they'd cost hasn't been disclosed.
There are limits to what's covered. The Apple Watch SE and base model iPad are reportedly excluded. The iPhone 16 and MacBook Neo aren't included either. Business and education purchases wouldn't be eligible, and AppleCare wouldn't be included in the price. This isn't a program designed to uniformly cover budget models or education/business purchases.
As of July 23, 2026, Apple and Klarna have not officially announced Apple Upgrade. Bloomberg also reported that Apple plans to stop accepting new applications for the current iPhone Upgrade Program and standard iPhone financing. What's been reported as ending is new applications specifically; how existing contracts would be handled remains unclear. It's also not confirmed whether Apple Card Monthly Installments or carrier installment plans would remain available.
The reported launch region is the US, and no timeline has been given for expansion to other countries, including Japan.
From 0% Loans to Returnable Leases
While the current official programs and the reported Apple Upgrade both look similar on the surface as "monthly payment" plans, they differ in how the contract ends.
| Purchase Method | Coverage and Term | Completion/Upgrade | AppleCare and Financing |
|---|---|---|---|
| iPhone Upgrade Program | Eligible iPhones, 24 months | After the equivalent of 12 payments, you can return the device and move to a new 24-month loan. After 24 payments, the buyer owns the device | Includes an AppleCare+ plan; financed at 0% APR through Citizens One |
| iPhone Payments | Eligible iPhones, 24 months | Pay off the full retail price to own the device. No upgrade option | AppleCare+ sold separately; financed at 0% APR through Citizens One |
| Apple Card Monthly Installments | 24 months for iPhone, 12 months for Mac/iPad/Apple Watch | Pay off the installment purchase price to own the device | 0% APR. Also available at the Education Store with education discounts |
| Apple Upgrade (reported) | 24 months for iPhone/Apple Watch, 36 months for Mac/iPad | Early payoff, early upgrade, or continued ownership/return at term end | No AppleCare included; Klarna handles financing. APR and other terms undisclosed |
When upgrading through the iPhone Upgrade Program after 12 payments, users return their old device, undergo a new credit check, and take out a new 24-month loan. The device must be able to power on and hold a charge, have a functioning screen, and show no damage or cracks. Once the return is complete, Apple pays off the remaining balance of the old loan to the bank, leaving only the new loan. To fully own the device, you must complete all 24 payments.
The reported Apple Upgrade would extend this same "upgrade" concept to Mac and iPad, and would build the option to return the device at term's end into the program itself. Bloomberg also reported that Apple discontinued its own self-run hardware subscription plan in 2024. With this new approach, where Klarna handles the financing, Apple can offer leasing both in-store and online without bearing the financial responsibility itself, according to Bloomberg.
Where Do the Lower Monthly Payments Come From?
Apple reportedly plans to market Apple Upgrade as an option with lower monthly payments than current financing. The term for Mac and iPad would extend from the current 12 months under Apple Card Monthly Installments to 36 months. Apple Watch would also extend from 12 to 24 months. iPhone, however, remains 24 months either way, so there's no term-extension effect there.
With a lease, the full device price doesn't need to be divided across the entire contract term. This is because the device's residual value at term's end can be carried forward, recovered either through reselling returned devices or through payments from users who choose to keep their device. This is why Bloomberg describes it as similar to auto leasing. Even if the monthly bill can be made smaller, that doesn't necessarily mean the total cost to keep the device ends up smaller.
The pricing information needed for comparison doesn't exist yet. Monthly payment amounts, APR, and down payments are unknown. What you'd need to pay to keep the device at term's end is also unclear. Fees for early upgrades or early payoff, along with charges for damage to returned devices, haven't been disclosed either. Buyers who want AppleCare would need to add that cost when comparing against current programs.
Klarna's Existing Product Has a 25th or 37th Payment
Klarna already offers "Upgrade Financing" for Apple products through its US digital store. This covers Mac laptops, iPad, and Apple Watch, but not iPhone, desktop Mac, or accessories. While this is a separate product from the reported Apple Upgrade launching July 28, Klarna's official terms reveal how it creates lower monthly payments.
Under this existing product, after completing 24 or 36 monthly payments, a 25th or 37th "Final Installment" remains. The displayed APR ranges from 0.00% to 35.99% depending on creditworthiness, and a down payment may be required. To keep the device, you either pay the final installment in full or undergo a credit check to refinance.
If you return the device to upgrade to a new one, the trade-in value applied to the final installment falls into one of three tiers—100%, 50%, or 0%—depending on the device's condition. Estimates are non-binding, and the final amount isn't determined until the device is received and inspected. It hasn't been confirmed whether the new Apple Upgrade would adopt the same residual value structure or assessment rates. Still, comparing monthly payments requires checking both the final installment and device condition.
Contract Numbers to Watch for in the Official Announcement
When considering Apple Upgrade, it's necessary to look beyond the initially displayed monthly payment and examine how the contract ends. If the end-of-term payment and APR are clearly disclosed, it becomes possible to separately calculate total costs for those who return the device versus those who keep it. Only once early-upgrade fees and damage-charge criteria are also included does a real comparison with the current iPhone Upgrade Program become possible.
A soft credit check also doesn't guarantee approval. According to Klarna's general consumer explanation, pre-qualification is an estimate of available credit, and actual approval for each purchase attempt is determined using the most current credit information. Even if Apple Upgrade uses a soft inquiry, it won't be a program anyone can automatically sign up for.
How existing iPhone Upgrade Program users would be treated, and whether upgrades would still be possible after new applications stop, remain undecided. If Apple Card Monthly Installments and carrier financing continue to coexist alongside the new program, buyers would be able to choose the exit path—ownership, return, or annual upgrade—that fits how they use their devices. Once official terms are published and total payment amounts and device ownership terms are made clear, Apple Upgrade could expand the options available for those looking to upgrade to a new Mac or iPad.