With Christmas fast approaching, Guyanese consumers have probably already entered a region of tunnel vision, a condition that often renders them unmindful of some important cautions that must be applied once they begin their Christmas shopping in earnest.
In a recent interview with the Stabroek Business, the Consumer Affairs Division (CAD) of the Ministry of Tourism said one area in which consumers often get it wrong is the entering into of hire purchase agreements. Hire purchase agreements facilitate the spirit of Christmas, insofar as they allow for the seasonal indulgence without the consumer having to immediately satisfy the obligation of paying in full.
At a time when the demands of the season place a premium on consumer liquidity, hire purchase agreements can be a godsend, even though the Consumer Affairs Division said they can come back to haunt those who don’t follow the rules. It turns out, according to a CAD brief seen by this newspaper, that consumers basically neglect to “read the fine print or the main details on their hire purchase contracts.” The brief said local consumers are in the habit of signing “agreements that sometimes they are not aware of” even though in the majority of cases what they most need to know is “present on the contract.”
In fact, the CAD said, “In a nutshell, consumers do not read the fine print or the main details on their hire purchase contract… Most of the times it is only after an issue occurs between supplier and consumer that the consumer becomes aware of what is on the contract. It seems that consumers are always in a hurry and want everything done fast, but it is pivotal that they read what they sign to.”
With greater numbers of local consumers likely to enter into hire purchase agreements in the period immediately ahead the CAD said that apart from reading and securing a clear understanding of the details of the contract, consumers should ensure not only that they safely retain receipts, agreements and other documents relating to their hire purchase transactions safely but also that they pay the stipulated installments with the agreed interest to the supplier within the stipulated time frame. Consumers should bear in mind that “possession is not ownership” and that it is unlawful “to dispose or sell any part of the item until you have fully paid off the price in the hire purchase agreement,” CAD warns.
The main features of a typical hire purchase agreement set out in the brief are: (1) the ownership of the good passes only when the consumer has paid off the last installment of the good he or she has hired; (2) under the hire purchase agreement the buyer can return the good to the supplier if he or she does not want to continue with the agreement; (3) the purchaser who has taken the good on hire purchase terms cannot transfer the good to a third party since he or she does not have ownership of the item and (4) the supplier can, at any time, repossess the good in cases of difficulty in obtaining payment of installments.
While the brief points out that hire purchase provides low income consumers with an opportunity to purchase goods that they would otherwise have been unable to buy on account of their limited resources, it points out that the opportunity to acquire goods on hire purchase can entice consumers into acquiring items that they do not need. This, it says, can result in longer-term financial difficulties. “Some people may spend the rest of their lives paying off what they have bought on hire purchase terms,” the CAD said.
