What’s the difference between PCP and HP?

What’s the difference between PCP and HP?

PCP: PCP is a popular, cost-effective way to finance a car with a flexible deposit and three end-of-contract options: keep, trade/part exchange, or return. Introduced in the late 90s, it defers the car’s value (Guaranteed Minimum Future Value – GMFV) until the end of the contract.

HP: Hire Purchase is a more traditional way to finance your car. You pay for the vehicle over fixed monthly payments (2-5 years), and ownership transfers to you at the end.