Credit Crunch Boosts Business Of British Pawnshops
London, England, United Kingdom (AHN) – British pawnshops have been enjoying good business the past few years as a result of the credit crunch.
The number of pawnshops in the country had trebled the past seven years because of the rise in number of Britons, particularly those belonging to the middle-class who patronize these establishments,
Growing in number at 10 percent yearly, the pawnshops have also gained social acceptance with some of the more prominent pawnshops being located on British high streets, according to Des Milligan, head of the National Pawnbrokers Association in Britain.
Consumer credit counselors said that while pawnshops charge high interest rates and owners of pawned items run the risk of losing items with sentimental value, pawning jewelry or electronic gadgets could be a good alternative to pay an overdraft instead of incurring extra bank charges.
Pawnshops also charge lower rates compared to payday loan companies and normally do not require credit checks, nor does a person’s history of pawning appear on his credit files. The NPA said the average interest charge of British pawnshops is eight percent for every $150 (100 pounds) loaned.
Milligan said over 80 percent of Britons who pawn an item eventually get it back.
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