Klarna leasing launches in US from $17.99

Apple launched a hardware leasing programme provided by Klarna on Tuesday, with iPhone leases starting at $17.99 a month and the scheme available only in the United States.

The programme, Apple Upgrade, is available on the Apple Store online, in the Apple Store app and at US Apple Store locations, Apple said. It offers 12 and 24-month leasing terms for iPhone and Apple Watch, and 24 and 36-month terms for Mac and iPad.

Leases start at $17.99 a month for iPhone, $11.99 for Apple Watch, $24.99 for Mac and $11.99 for iPad, according to Apple.

At the end of the term, customers can upgrade to a new device under a fresh lease, buy the device with a one-time payment, or return it and exit the programme.

“At Apple, we put the customer at the centre of everything we do,” said Karen Rasmussen, Apple’s vice president of the Apple Store online, “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.”

Apple said it will no longer offer the iPhone Upgrade Program or iPhone Payments in the United States. Customers already enrolled can lease under Apple Upgrade when eligible, use Apple Card Monthly Installments, buy outright or take carrier financing.

The monthly cost is lower than under the discontinued scheme, but customers do not own the device at the end of the term. Apple said an iPhone 17 Pro 256GB with a purchase price of $1,099 carries a typical monthly payment of $31.99 over 24 months, or $45.99 over 12 months. Under the iPhone Upgrade Program the same model cost $57 a month over two years, with ownership at the end of the term. That programme also required customers to buy AppleCare cover; under Apple Upgrade, AppleCare is optional.

Applicants are subject to a soft credit inquiry that does not affect their credit score, and no security deposit is required, Apple said. Its terms state that customers may incur substantial fees for terminating a lease early, and that a lease not ended, upgraded or bought out converts to a month-to-month arrangement for up to six months, during which payments may increase.

Leases are available only to US residents and cannot be taken out through Apple at Work for small businesses or enterprises, or through Apple’s education, government or employee purchase programmes, according to Apple’s terms. Apple has not announced a UK launch. Klarna already offers instalment payments to UK consumers through partners including Airbnb, which introduced Pay Over Time with Klarna for UK guests in 2023.

In the UK, the Financial Conduct Authority began regulating deferred payment credit on 15 July 2026. The regulator defines this as interest-free credit repayable in 12 or fewer instalments over 12 months or less, and says agreements taken out before that date remain unregulated.

The launch follows price rises across parts of Apple’s range. Last month Apple increased Mac and iPad prices by $200 or more on some models. Chief executive Tim Cook said higher iPhone prices were unavoidable because of the cost of memory and storage chips, demand for which has risen from artificial intelligence companies.

Apple shares rose slightly in early trading on Tuesday, while Klarna shares fell slightly. Apple briefly passed a $5 trillion valuation earlier this year and reported record iPhone sales for the final quarter of 2025, with total revenue of $144bn.

John Ternus takes over from Cook as chief executive on 1 September, shortly before Apple is expected to announce a foldable iPhone.

Amy Ingham

Amy Ingham is a reporter at Business Matters, covering UK business news with a focus on breaking news, business policy, late payments and insolvency. She joined the magazine in 2026 after completing the NCTJ Diploma in Journalism at Harlow College’s journalism school. Her recent reporting includes British Steel’s nationalisation and its impact on SME suppliers, the decline in late payments by large firms, and Insolvency Service director disqualifications. Reach her at aingham@cbmeg.co.uk.