Old mother Riley at the pawnshop door,
Baby in her arms and a bundle on the floor…OLD MOTHER Riley might have difficulty recognising a pawnshop these days, just as Des Milligan, chief executive of the National Pawnbrokers Association, m
ight roll his eyes wearily at the rhyme and the images of Dickensian poverty he still finds himself fielding – particularly, he says, from journalists. For "the pawn", sometimes described as the second-oldest profession, has entered the 21st century with renewed vigour: the current credit crunch has seen 96 per cent of pawnbrokers in the UK experience rises in business of up to 24 per cent in recent months. These days, rather than the ill-lit curiosity shop we commonly imagine, a pawnbroker is more likely to occupy premises that you'd be hard put to distinguish from a jeweller's – bar those timeless three balls, but even these may have have been incorporated into a modern logo.
The days of pawning your suit, or for that matter your bagpipes (as at least one piper of this writer's acquaintance used to do), are long gone. Most loans these days are made against jewellery – with nearly 90 per cent of customers repaying their loans – and while pawnbrokers still cater for a strong customer base of people looking for short-term loans of around £120, according to Milligan, at the other end of a polarised market, "are a growing number of really well-off people, often successful business people, who use pawnbrokers for huge amounts. One of our members has a builder who regularly borrows £1,500, pawning jewellery; another has a Rolex watch that he regularly pawns.
"It's not just the latest credit crunch," stresses Milligan. "There has been a resurgence, partly because awareness of pawnbroking is growing. There are a few myths going about that put people off, but when you explain to them how pawnbroking works, it's OK."
One such myth, he says, is that people think pawnbrokers wants to buy their goods as cheaply as possible, sell them and make a fortune. "The other is that he actively wants to keep your goods. In fact, that's the last thing he wants to do, because if you have a nice ring, say, and you're giving it as security on a loan, the last thing he wants to do is sell it because you'll never be able to go back and re-pawn it. Also, pawnbrokers don't want to part people from heirlooms: it's upsetting. In fact, nine times out of ten people are re-united with their jewellery."
For the businessman seeking a quick injection of cash, argues Milligan, "a bank will want detailed historical figures for your business ... and they'll almost certainly ask for collateral, your house, for example, and the loan period will probably be two to three years, with redemption clauses. For someone wanting cash just for two or three months, although our interest rates are higher, it's worth it because it's over a much shorter period of time."
A recent trend, which Milligan confirms, is an increase in immigrant clients from Eastern Europe or Africa, often using a pawnbroker for money-transfer facilities to send funds abroad.
During the turn of the 19th and 20th centuries, Britain's towns could boast virtually as many pawnbrokers as public houses and they have worked their way into our iconography of Victorian poverty. Their image has changed vastly over the past few decades, says Milligan.
In Glasgow, Edward Fox also sees vast changes in pawnbroking, which he entered 37 years ago as a 17-year-old. "The pawn today is a lot different from what it was historically," says Fox, proprietor of Robert Biggar, which claims to be the oldest pawnbroking business in Scotland, and of Duncanson & Edwards in Edinburgh. "For a start, we don't take furs, clothing, etc. It's mostly gold and diamond jewellery, precious stones, watches – Rolex, Cartier, Breitling, Omega – but also a lot of guitars, golf clubs, digital cameras and electronic wizardry."
He was recently offered an Aston Martin for a loan, although in that instance he turned it down. Other notable items he's accepted as security have included a Fabergé cigarette case and a set of paintings by Peter Howson.
"There is no doubt that we are getting a lot of new clients, people who have never pawned before, and a lot from the middle classes. I always point out to them that using a pawnbroker's service is a quick fix, if used correctly.
"I used to own three shops but now trade from the two. I loaned more from these two shops during May than I ever lent between the three shops at any time within the past five years."
The full article contains 816 words and appears in The Scotsman newspaper.
