IT’S an accepted reality that prosperity, whether in the home or nationally, cannot be reached through savings alone. Credit is essential. There must, however, be rules to credit. The Hire-Purchase Bill, which makes provisions for regulating not only hire-purchase but also sale of credit and conditional sales agreements, was passed in the National Assembly on Wednesday.

Many Guyanese have already made use of hire-purchase arrangements, which, it could be said, become especially popular during the Christmas season and the new year as many opt for their homes to have a fresher look. The Bill protects both the buyers and the sellers. Clause 8 of the Bill, one which outlines a duty of the buyer or hirer, notes that this person must provide information to the owner of the good about the location of the goods if this is requested.

There have, in the past, been many anecdotal stories of persons purchasing items on hire-purchase and subsequently relocating without properly informing the owner that there was a change in address and the item was relocated. It should be noted that “owner” which, in most cases is a retail store, remains the substantive owner of the goods on hire-purchase until proper ownership is transferred following the completion of the terms of ownership in the sales agreement.

Clause 6 on the other hand looks to the responsibilities of the owner, but moreso their limitations. One such limitation is that the owner does not have the authority to forcefully enter the premises of the hirer to seize the goods. Where there are hire-purchase agreements which include such a provision, that provision would not be backed by law. The law also opens the doors for matters of dispute between the owner and buyer to be settled in ways that are mutually respectful.

Clause 17 is truly an equalizer. It proves, according to the explanatory note of the Bill, that “where the hirer or buyer has paid 50 per cent or more of the hire-purchase price or total purchase price, the owner or seller shall not enforce any right to recover possession of the goods otherwise than by action in a court of law.” This provision gives the power to the court alone to rule on the return of the item if a substantial amount has already been paid to the owner.

Further along, Clause 23 outlines how repossessions could be facilitated. The explanatory note records: “Where goods have been let under a hire-purchase agreement or sold under a conditional sale agreement and less than 50 percent of the hire-purchase price or total purchase price has been paid, the owner or seller shall not enforce any right to recover possession of the goods unless he has given the hirer or buyer a notice of his intention to do so.

“The owner or seller may, on the expiration of 21 days after the notice has been given to the hirer or buyer, enforce his right to recover possession of the goods. The notice shall be deemed to have been given if it is directed to the hirer or buyer and delivered at or sent by registered letter to his address.”

There are also, of course, provisions which protect the owner during lawful repossessions. This new law will surely see a transformation in the national hire-purchase arrangement, and ultimately will see a stronger culture of consumer rights and structured credit arrangements being developed, which are both necessary in any growing economy.