Code found in the iOS 27 beta shows that if a user on the forthcoming Apple Upgrade program misses a payment, Apple will have the ability to restrict their iPhone usage.
Apple is now expected to shortly launch a financing option, replacing the previous iPhone Upgrade Program. It will let buyers spread the cost of most Apple devices, thereby easing the sales hit Apple expects to take from rising prices.
It will definitely help buyers, but it comes with certain risks for Apple. The company is already said to be partnering with the Klarna financial firm over the payment program, but there is also a risk of users defaulting on their payments, as has happened with Apple Card.
To combat that, Apple appears to be taking steps in iOS 27 to severely limit the use of iPhones when payments have been missed. There is no detail over whether this happens after just one or some other number of missed payments, but as first spotted by 9to5Mac, code in the iOS 27 beta includes a reference to limiting usage.
Called App Managed Features, it’s a framework that means Apple can switch on a “Restricted Mode.” It would seemingly do this until a payment issue is resolved, and while in this mode, users would only be able to use the phone plus:
- Accessibility Reader
- App Store
- Health
- Magnifier
- Clock
- Settings
- Wallet
- Passwords
There may be other apps that remain available, or perhaps just features such as Messages or critical alerts.
A further new framework called “Partner Finance Lock” reportedly prevents users from erasing the iPhone. It also blocks reselling the device, or even stripping it for parts.
As part of keeping this Partner Finance Lock working if an iPhone is successfully erased or restored, the framework is in the Find My code. It does not, though, mean that the finance company gets any location details from the device.
It’s not clear what the process is for Apple restricting the use of the iPhone, and there must always be the possibility that it could happen in error. That makes this idea initially seem unlike Apple, and even draconian.
However, one of the reasons that Goldman Sachs pulled out of Apple Card was that there were sub-prime users who apparently had no intention of paying their balances. In 2024, when JP Morgan Chase began negotiations to take over Apple Card, those unpaid balances amounted to $17 billion.
