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Funding Methods -
Contract Hire
Risk:
Funder assumes risk.
Market Share: Around 40% and growing.
Popular With: All fleets able to reclaim VAT.
How it Works:
The leasing company calculates a residual value for a vehicle at a
set age and mileage contract, and charges the user a monthly fee to cover
depreciation over that period, plus a funding charge, along with add-on
services such as maintenance and accident management. The user takes no
risk in ownership and has predictable monthly costs. The user effectively
just pays for the use of the vehicle.
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