TYPES OF CREDIT

Hire Purchase: Is a situation whereby a buyer would have to pay an initial deposit to a seller and takes the good in question home for use with the agreement to pay the balance amount on monthly installments. But whereby the buyer fails to pay the monthly installments the seller will have to reclaim the ownership of the good in question.

Budget Credit: This is a credit between a wholesaler and his retail customers. In this type of credit, the wholesaler will have to open a notebook where he will record the maximum amount of credit sale to be allowed for each of his retail customers.

Book-me-down: Here, the customer purchases goods from a nearby retailer and promises to pay within a Specified period of time.

Trade credit: Is a credit granted by a wholesaler to a trustworthy retailer.

Advance payment: This is a situation whereby a retailer or wholesaler pays some amount in advance to the manufacturers in expectation of goods to be produced. 

Loans and overdrafts: These are credit facilities given by commercial banks to their customers in which interest is charged

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