On Tuesday, we reported that Apple and Klarna are teaming up to offer a new “Apple Upgrade” program set to launch in the U.S., giving allowing buyers to finance most iPhone, iPad, Mac, and Apple Watch models, giving them several months to pay off their new devices.
Now, code discovered in the iOS 27 beta shows that if you miss a payment on the new program, Apple will have the ability to LoJack your iPhone and restrict your usage.
The Apple Upgrade program, which replaces the Phone Upgrade Program, will allow buyers to spread the cost of most Apple devices among monthly payments, hopefully easing the sales hit Apple expects to take from rising prices.
While the new program will likely become popular among iPhone buyers, it carries certain risks for Apple, as buyers could default on their iPhone payments, something Apple has seen with their Apple Card credit card offering. (In 2024, those unpaid balances amounted to $17 billion, which is one of the reasons Goldman Sachs wanted out of the deal.)
Apple appears to be heading off those fears by including code in iOS 27 that allows the Cupertino firm to severely limit the usage of an iPhone whose owner is behind on payments. Ss first spotted by 9to5Mac, code in the iOS 27 beta includes a reference to limiting usage. However, the code doesn’t provide a clue as to whether it will happen on the first missed payment or a larger number of missed payment deadlines.
The “App Managed Features” framework gives Apple the power to switch on a “Restricted Mode.” While in this mode, users would only be able to use the phone plus the following features:
Apps that can send critical alerts may also remain accessible for safety reasons, such as Messages, Home, medical, and other safety-related apps.
Another new framework, called “Partner Finance Lock,” looks to block users from erasing the iPhone. It also blocks reselling the device, or even stripping it for parts.
While the new frameworks exist within Find My, this doesn’t give the financing company any access to the device’s location, so you don’t have to worry about Emilio Estevez showing up at your door to repo your iPhone.
Of course, if Apple goes through with the ability to LoJack a customer’s iPhone, they will have to do their best to ensure that it doesn’t happen by error, or that the less-than-savory types out there figure out how to trigger the shutdown for malicious purposes.