Apple has announced a new device leasing program called Apple Upgrade, launched in partnership with the buy now, pay later service Klarna. The program is available for iPhone, Apple Watch, Mac and iPad through the Apple Store online, the Apple Store app and at Apple Store locations in the United States.
Leasing prices start at $17.99 per month for iPhone, $11.99 per month for Apple Watch, $24.99 per month for Mac and $11.99 per month for iPad. Customers can choose one- or two-year leases for iPhone and Apple Watch, and two- or three-year leases for Mac and iPad.
At the end of the lease term, customers have the option to upgrade to the latest device, purchase their current device with a one-time payment, or return it and exit the program. Monthly payments can be lowered by trading in an existing device through Apple Trade In, and Apple Card users can earn 3% Daily Cash back on lease payments.
Apple says the rollout comes as the company faces supply chain issues related to a memory chip shortage, which it has called “RAMageddon,” and recently announced price increases for Mac and iPad lineups. The Upgrade program is seen as a way to make higher prices more manageable for consumers.
With the launch, Apple is discontinuing its existing in-house financing and installment programs in the US, including the iPhone Upgrade Program and iPhone Payments. Customers can manage their lease through the Klarna app.