Apple (NASDAQ:AAPL), one of the world’s largest companies, has partnered with Klarna (NYSE:KLAR) to enable product leasing for 12 to 36 months via “Apple Upgrade.” Currently, leases are only available to US residents
As was previously reported, Klarna, a global BNPL and neobank, has formed similar partnerships with big brands.
Karen Rasmussen, Apple’s vice president of the Apple Store online, said they were pleased to offer a more flexible way to pay for products.
Apple has previously enabled Apple Card holders to finance products while receiving 3% cashback and a zero percent APR. Apple stated that the launch of Apple Upgrade means Apple will no longer offer the iPhone Upgrade Program and iPhone Payments in the United States. Eligible customers currently enrolled in the iPhone Upgrade Program will have the option to lease a new device with Apple Upgrade, finance with Apple Card Monthly Installments, purchase the product outright, or choose carrier financing.
By enrolling in the Klarna service, customers will be subject to a soft credit inquiry and a decision within “minutes.”
As with other lease programs, at the end of the agreement, users may either return the product or make a lump-sum payment to keep the device.
By offloading the financing to Klarna, Apple provides a valued service without the affiliated risk. It can also simplify purchasing a product while supporting buyers who do not want to pay a significant amount at the point of purchase. As the prices of Apple’s products have been rising, largely due to inflation, Apple should be able to mitigate the potential loss of more price-sensitive consumers.