Question

Explain the following concepts:
a. Hire purchase system
b. Installment payment system.

Answer 1

Hire purchase system - Hire-purchase system is a credit purchase . he price under hire purchase system is paid in installments . Hire vendor continues to be the owner of the goods till the payment of last installment.

Installment payment system -  Installment payment system also known as deferred installments . It is a system where the buyer is given the ownership as well as the possession of the goods at the time of purchase .

Answer 2

Hey fellow,

The difference between hire payment system and purchase payment method is very minimum, It is following;

Hire Payment System: In this method, the customer pays for the product in terms of credit i.e paid at a later date, in the form of of installments. Up until the time the last installment is made, the product and its ownership remains of the seller

Installment Payment Method: This method is also very similar to the hire payment system, the only difference is that the product and its ownership is given to the customer on the basis of first installment. The later instalments are paid in whatever manner that is decided between the both.

Thanks