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5 Things You Didn’t Know About Pawnshops

Being more accessible than banks, pawnshops have been a prevalent presence in the lives of Filipinos for many years. They have stood against the test of time and have continued to provide funds for any struggling kapwa Pilipino at a reasonable cost. Despite this, there are a lot of things not known about them. Below are a few lesser-known facts about pawnshops that might just surprise you.

1. Regulation

Licensed Philippine-based pawnshops, like Cebuana Lhuillier, are regulated by the Bangko Sentral ng Pilipinas (BSP) through the Registration of Pawnshops and Money Service Business. This is to ensure the physical and financial safety of all pawnshop customers.

2. Responsibility

Aside from regulation, pawnshops also work with various establishments to ensure that the items they accept aren’t stolen goods. Pawn brokers are trained to identify their customers and keep records of the people they deal with.

In fact, all personnel in charge of pawnshops are screened and required to attend a seminar as per the orders of the Anti-Money Laundering Council (AMLA). This is to ensure that they are knowledgeable about customer identification, record keeping, and reporting of covered or suspicious transactions.

3. Authenticity

Pawnshops disregard age, style and brands when appraising jewelry. Instead, they pay attention to the actual value of the item. The prices of precious metals, such as gold and platinum, and precious stones, like diamonds, tend to fluctuate in the international market. Pawnbrokers monitor these and will adjust their prices accordingly to the weight and karat of your item. This means that, no matter how old your item is, you’ll still get a fair price according to the world market.

4. Accessible

According to the BSP, 86% of Filipino households don’t have a bank account. That means that these Filipinos cannot apply for a bank loan should the need arise. Also, most lending establishments will require you to present a credit report, something that is not at all easy to keep spotless nowadays.

Pawnshops, on the other hand, do not require you to have a good credit score. They only need two things to conduct a transaction: a valid ID and collateral.

That’s not to say that pawnshops are unsafe because of their availability. The essence of their business, to ‘hold’ an item in exchange for a loan, protects the establishment from losing money by taking ownership of said item should the pawner default on their payments. But as long as you stick to the agreement, you’ll get your item back at the end of the loan period.

This is good news for people outside the financial mainstream. Sure, temporarily losing your precious ring or laptop may not feel good, but going to a pawnshop is a much safer bet than borrowing from an unscrupulous lender and falling in an unending cycle of debt.

5. History

What may come as a surprise to most people is that St. Nick, Father Christmas, or more commonly known as Santa Claus, is the patron saint of pawnshops. The pawnshop industry started out as charitable organizations that helped the needy known as montespietatius. They would give low-interest loans to the poor to help them buy food and other necessities. Santa Claus’ well-known generosity and selflessness cemented his place as the patron saint of the montespietatius.

In the context of the Philippines, not much has changed. While most people who go to pawnshops are not in such dire straits that they are lacking in food, they still receive the help they need at an affordable cost.

With all of that said, you may be looking for a pawnshop that can provide you with some help during this Christmas season. No worries, as Cebuana Lhuillier has got your back. With their Pawning Service, you can be sure that you’ll never go short on any amount, as they accept an array of items, from jewelry to gadgets, as collateral. They also lead the pawning industry by offering safety and the highest appraisal rate with close to 2,500 branches nationwide. Visit your nearest Cebuana Lhuillier branch now – for a fast, easy and secure transaction.