Apple will now let you lease an iPhone for as little as $17.99 a month. Yes, you read that right.
On Tuesday, the tech giant launched a new program called Apple Upgrade, a partnership with “buy now, pay later” service Klarna that enables U.S. customers to pay for certain Apple products via monthly installments.
Along with the iPhone, Apple announced that the Apple Watch, Mac, and iPad are also eligible for lease online through the Apple Store, in the Apple Store app, and at Apple Store locations. Apple Upgrade offers one- and two-year leasing options for the iPhone and Apple Watch, and two- and three-year options for Macs and iPads.
Shares of Apple Inc (Nasdaq: AAPL) were up nearly 1% and shares of Klarna were up 2% (Nasdaq: KLAR) in midday trading on Tuesday.
“At Apple, we put the customer at the center of everything we do,” Karen Rasmussen, Apple’s vice president of the Apple Store online, said in a statement. “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.”
What products are available for Apple Upgrade and how much will it cost?
Depending on the model, 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.
However, iPhone 16, iPhone 16 Plus, Apple Watch SE, MacBook Neo, Mac mini, iPad (A16), and Studio Display are not available as part of the Apple Upgrade program.
Is there a trade-in option?
Yes, when customers enroll in Apple Upgrade, they can lower their monthly lease payments by trading in their currently owned devices through Apple Trade In.
Another way to get a discount: Customers can also earn 3% Daily Cash back when making their lease payments with Apple Card, the company’s credit card that is co-branded with Mastercard.
How do I apply, and how does this work?
There is a “soft credit inquiry” that takes a few minutes. Good news: It won’t impact customer credit scores. Once approved, choose a leasing option. In-store customers can pick up their new devices right away, while online customers can choose delivery or in-store pickup.
At the end of the lease term, customers have a few options: upgrade their device to the latest generation, purchase the current device with a onetime payment, or simply return it and exit the program, Apple said.
Say goodbye to iPhone upgrades
With the launch of Apple Upgrade, the company said it will no longer offer the iPhone Upgrade Program and iPhone Payments in the U.S.
Instead, when eligible, customers currently enrolled in the iPhone Upgrade Program will have the option of leasing a new device with Apple Upgrade, financing with Apple Card Monthly Installments, purchasing the product outright, or choosing carrier financing.
Apple hikes prices
The news comes a month after Apple hiked prices on several of its best-selling products—including Mac desktops, MacBooks, iPads, and HomePod devices—citing an extraordinary surge in global AI-driven memory and storage costs. However, it spared the iPhone, the company’s most successful and profitable product.
iPad and Mac prices are up at least $100—some models increasing by more than $1,000—with an average price increase of $246.67, according to MacRumors.
