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Hire purchase is an arrangement for buying expensive goods, where the buyer makes an initial down payment and pays the balance plus interest in installments.
See our worksA Hire Purchase System is a system in which the hirer purchases goods from the vendor but does not pay him in full. Instead, he makes a lump sum payment known as a down payment, and the remainder is paid in instalments by the purchaser of the goods.There are two main types of hire purchases based on the functional purpose of the asset involved. These types are the consumer and industrial hire purchase agreements. Hire purchase (HP) is a type of borrowing. It is different from other types of borrowing because you don't own the goods until you have paid in full. Under an HP agreement, you hire the goods and then pay an agreed amount by instalments.
