Hire Purchase

DTB Hire Purchase helps Small and Medium Enterprises acquire new, used or reconditioned business assets and spread the cost over an agreed repayment period instead of paying the full purchase price upfront. It is an asset-financing option for SMEs that need productive assets while preserving cash for day-to-day business operations.

Overview

Hire Purchase is a business asset-financing solution that allows an eligible SME to acquire an approved asset now and repay the financed amount over time. It can be useful when your business needs a vehicle or equipment to generate income, serve customers or expand operations but you do not want to use all your available cash to make the purchase upfront. DTB can consider qualifying new, second-hand or reconditioned assets, subject to the asset type, valuation, documentation and credit approval.

What You Need to Open an Account

The requirements are as follows:

Duly completed registration/application form.
National ID or passport - original and copy.
KRA PIN certificate.
Latest three months’ payslips, if employed.
Latest six months’ bank statements if you are not currently banking with DTB.
Written request stating the purpose or business need for the asset.
Certificate of registration for a sole proprietor or partnership.
Copy of the logbook where a used vehicle is being financed.
Under the current published terms, a used vehicle should not be more than 8 years old.
Valuation report from a DTB-authorised valuer for a used vehicle.
Latest audited accounts and annual returns for companies.
Memorandum and Articles of Association for companies.
Certificate of Incorporation for companies.
Board resolution authorising the borrowing for companies.

Comprehensive insurance with DTB’s interest noted, where applicable to the financed asset.
Tracking device for financed vehicles or other assets where required under the facility terms.

Features

Access a comprehensive suite of banking services and tools:

Purpose & Currency:
- Purpose: asset financing for qualifying new, used or reconditioned assets.
- Available in local currency (LCY) and foreign currency (FCY), subject to DTB approval.
Published Vehicle Repayment Periods:
- Used cars: up to 60 months under the current live webpage.
- New cars: 72 months.
- The repayment period for other asset types should be confirmed with DTB because the live page publishes specific tenures only for cars.
Interest Rate & Fees:
- Interest rate: prevailing market rate, with the actual rate confirmed during appraisal.
- Appraisal fee: 2% of the loan amount, then 1% on the anniversary of the loan, as currently published by DTB.

FAQs

Answers to common questions about hire purchase, SME asset finance, vehicle and equipment financing, used assets, costs and applications in Kenya.

Hire purchase is a way to finance a qualifying asset by acquiring it for business use and repaying the financed amount over an agreed period instead of paying the full purchase price upfront. With DTB Hire Purchase, eligible SMEs can apply to finance qualifying new, second-hand or reconditioned assets, subject to credit appraisal, asset checks and the facility terms.

If the equipment or asset qualifies under DTB Hire Purchase, your business can apply to finance the purchase and spread repayment over time. This can reduce the amount of cash required upfront and help preserve working capital for stock, salaries, suppliers and other operating expenses. DTB will confirm whether the specific equipment qualifies and what contribution is required.

DTB’s current page describes Hire Purchase as asset financing for new, second-hand or reconditioned assets and includes detailed vehicle requirements. DTB’s broader product material also refers to motor vehicles and used equipment. Because terms can differ by asset type, confirm the exact vehicle, machinery or equipment you want to purchase with DTB before committing to the transaction.

Hire purchase is one form of asset finance. Both are used to help acquire productive assets without paying the entire purchase price upfront, but the legal structure, ownership treatment, deposit, repayment terms and documentation can differ. Ask DTB which asset-finance structure applies to the specific asset you want to acquire.

Hire Purchase is designed specifically around acquiring an approved asset, so the financed asset and transaction are central to the facility. A general business loan may be structured for a wider business purpose. If your main need is a vehicle or equipment purchase, compare the total cost, repayment period, required contribution, security structure and cash-flow impact of both options before choosing.

Hire Purchase may suit a business whose objective is to finance the acquisition of a qualifying asset over time, while leasing can suit a business that primarily wants the use of an asset under a lease structure. DTB offers a separate Leasing product. Compare ownership objectives, upfront cash requirement, monthly or periodic cost, accounting/tax treatment and flexibility, and obtain professional advice where necessary.

Yes, the current DTB Hire Purchase page publishes a repayment period of up to 72 months for new cars. Approval depends on the vehicle, purchase documentation, your business or personal repayment capacity and DTB’s credit assessment. Other commercial vehicle categories may have separate DTB asset-finance products and terms.

Yes, qualifying used or reconditioned assets can be considered. For used vehicles, DTB currently requires a logbook copy and an authorised valuation and states that the vehicle should not be more than 8 years old. The current live page publishes a repayment period of up to 60 months for used cars.

The current Hire Purchase page does not publish a fixed deposit or financing percentage. The amount you need to contribute will depend on the asset, valuation, purchase price, your financial position and DTB’s approved facility terms. Ask DTB for the required customer contribution before finalising the purchase.

The published requirements include identification and KRA PIN documents, recent bank statements, a written request explaining the asset need, business registration documents and, for companies, audited accounts, annual returns, incorporation documents and a board resolution. Used vehicle applications also require the logbook and an authorised valuation report.

DTB currently lists comprehensive insurance with the Bank’s interest noted as an additional requirement. The exact insurance class, sum insured, approved insurer and renewal requirements will depend on the financed asset and facility terms. Vehicles may also require a tracking device.

DTB currently states that Hire Purchase is priced at the prevailing market interest rate. The published appraisal fee is 2% of the loan amount, followed by 1% on the anniversary of the loan. Ask DTB for a complete cost illustration, including any applicable valuation, insurance, tracking, taxes or other transaction costs before accepting the facility.

Yes. Instead of using a large amount of cash to buy an asset outright, an eligible business can spread the cost over time. This can leave more cash available for day-to-day needs such as inventory, suppliers, payroll, rent and operating expenses, although your business should ensure the repayments remain affordable.

Compare the required deposit, total cost of credit, interest-rate basis, appraisal and other fees, repayment period, new versus used asset rules, maximum asset age, insurance and tracking requirements, currency options, early-settlement terms and the lender’s approved asset categories. DTB currently offers local and foreign currency Hire Purchase and publishes repayment periods of up to 72 months for new cars and 60 months for used cars on the live webpage.

Select Get In Touch on the DTB Hire Purchase page or contact a DTB branch. Identify the asset you want to acquire, obtain the relevant seller or asset documents and prepare the required personal or business financial information. DTB will assess the application, asset and repayment capacity before confirming the approved amount and facility terms.