A payment plan is an agreement between a buyer and a seller that allows the buyer to pay for a product or service in installments over time, rather than in a single lump sum. This arrangement can make larger purchases more manageable, as it breaks down the total cost into smaller, more affordable payments. Payment plans are commonly used for various expenses, such as medical bills, tuition fees, and large purchases like furniture or electronics. They can vary in terms of duration, interest rates, and payment frequency, providing flexibility to meet the financial needs of different individuals or businesses.