Families pawn watches and jewellery to afford school fees.
British pawnbrokers are said to have experienced a rise in “middle class” customers pawning fine watches and jewellery in order to pay off expensive bills such as school fees and holiday deposits.
In a report published in The Sunday Times at the weekend it was found that parents were pawning items such as Vacheron Constantin timepieces in order to pay their bills.
John Nichols, chief executive of H&T pawnbrokers said the increase in customers pledging more expensive items was evident in his chain of almost 200 stores across the UK. He spoke with Professional Jeweller about The Sunday Times’ findings.
“Yes we have seen more high-end pieces coming into our stores but with finer items the loans are typically short term with a higher incidence of redemption," said Nichols.
"At present around 95% of the luxury goods pledged are redeemed, which is what we want. We want people to get their goods back.”
The brands being pawned at H&T include Breitling, Cartier and Rolex. Nichols said that the present economic environment makes pawnbroking an attractive option to consumers who may not have previously considered it.
“Mostly it will be a Rolex watch and the customer will want a loan to help with lumpy expenditure such as a VAT bill or school fees,” he said.
The increase in persons with higher incomes pawning luxury items can be attributed to a number of factors, be those an increased awareness on the high street or more attractive stores.
Intensive staff training has also helped boost the opinion of pawnbrokers, as is the case for H&T which has put 700 of its 1,060 staff through two-day long training courses this year.
The Sunday Times report revealed that TGS Pawnbrokers, which runs 14 shops in London, had had a “considerable number” of people coming to them to pawn items – which include luxury cars such as Bentleys and Porsches – in order to finance holidays.
Online pawnbroking site borro.com is reported to have experienced a four-fold increase in lending in the past six months, possibly on the back of a widespread advertising campaign on television and through mediums such as the London Underground.
For H&T the boom in pawnbroking and cash for gold services has seen it add more than 50 new stores to its portfolio during the past 12 months. It will open another five in London before Christmas this year.