Online Pawnshops: Everything You Need to Know
When you’re tight on cash and in need of funds, there are a couple of ways that you can acquire a loan:
- You can seek help from the usual sources like the bank or the government, which normally takes several days to process a request.
- You can also ask a friend who may have extra funds to spare and might be willing to lend you some money.
However, if you’re not too keen on either of those choices, there’s always the easiest and most immediate alternative to getting the funds you need: the pawnshop. Here you’ll be able to get a loan instantly so long as you provide an item you can leave as collateral. It’s simple, easy, and convenient.
In recent years, technology has made it possible for traditional forms of fund transactions to become a faster, more accessible process through the internet. Pawnbroking, for instance, is no stranger to this development as a considerable number of online pawnshops have emerged.
In this article, you’ll learn about how online pawnshops work, what you can pawn, and how best to get the most value out of your item to receive the funds you need.
What are Online Pawnshops?
Online pawnshops work the same way that traditional pawnshops do, in that they provide you a fast and convenient way to acquire cash, be it through selling items or a loan. They have become a widely known solution to short-term financial emergencies and can be accessed through a website.
Through online pawnshops you’ll be able to apply for a loan so long as you can provide an item as collateral. Usually, a representative will come to inspect and claim the high-value item you’ve offered upon application, or the item will be shipped to the pawnbroker. From there, approval will take a few hours, after which your loan will be deposited to your bank account.
The introduction of online pawnshops has undoubtedly made it much easier for people who have a limited source of funds and access to banks to pay for their short-term financial expenses. For example, the World Bank’s Global Findex database found that only 1.9% of the Philippine population have credit cards.
In times of emergencies, budget restraints make it difficult to pay for these things. This has amplified the need for Filipinos to seek help from services that pawnshops offer. According to the Bangko Sentral ng Pilipinas, as many as 72% of Filipinos use pawnshops in a month. Presently, there are pawnshops for every 3,200 adults in the country.
With the growing number of pawnshops, it begs the question: what are the benefits of online pawnshops to traditional pawnshops?
Why are Online Pawnshops Better than Traditional Ones?
Among the advantages of opting for an online pawnshop is the notable value for money you receive for the item you provide as collateral. Online pawnshops deal with high-end value goods such as jewelry, designer bags, luxury watches, and electronics. This strategically provides customers with a much bigger loan amount. What’s great about this higher price is that chances are, the interest rate will be much lower.
After your first successful transaction with an online pawnshop, let’s say you come back to deal again. You do so for several more occasions until you’ve become a trusted client who pays on time. When you establish a good reputation, there is a bigger chance that your terms can be adjusted to what you might need in your next transaction.
Another key advantage to online pawnshops is that their interest rates are significantly lower than the physical pawnshops. This is precisely because they don’t need to pay miscellaneous fees for store maintenance and the like. This decreases the likeliness of them adding any hidden charges. That’s a sweet deal, especially because that means you’ll be paying a lot less.
Perhaps the one real downside to traditional pawnshops is the speed at which loans are granted. While online pawnshops may not be able to release cash as instantly as you could expect from a pawnshop you visit physically, it certainly offers you the convenience and safety of transacting right at home. No need to exert the extra effort in bringing your collateral all the way to the store.
What Items Can You Pawn in an Online Pawnshop?
Traditionally, items that are pawned are high-value items like gold, silver, and precious metals and stones, which can be evaluated by a pawnbroker for authenticity and condition. In the modern day, however, you are no longer limited to offering just jewelry for collateral as there are many different items which can be valued for bigger prices.
Items that can be pawned:
- Jewelry with precious metals and stones. The no-brainer pawn standard. It’s also subject to inspection for its authenticity and value.
- Gems and diamonds by themselves can have a high resale value.
- Watches with precious metals and stones are worth quite a lot. They do, however, need their official paperwork to verify its authenticity. This especially applies to luxury brand watches.
- Collectible coins and currencies. Granted that these items are made with high-value material like silver, then they’re bound to have a bigger loan rate.
- Mobile devices like phones and tablets. They have a higher value when their original accessories come along with them.
- Power tools which have a good resale market, especially brands like Bosch and DeWalt.
- Firearms also have a big retail value at pawnshops that are licensed to deal with them. They do, however, require legal paperwork.
- Antiques and fan collectibles like sports-related memorabilia are regarded as high value items, too.
While it’s less than ideal to be giving up a prized possession for funds, there are a lot of advantages to opting for the pawnshop over standard loans. Your chances of getting denied a loan are much smaller than applying through a bank, and it eliminates any kind of dreaded difficulty in borrowing money from loved ones. You also get the funds much faster with a significantly lower interest rate. It’s also a convenient way to acquire money for short-term financial needs.
In this day and age where daily expenses are skyrocketing due to inflation and other factors, it becomes a lot more challenging to get by on the standard budget. Online pawnshops give everyone a fair chance to live as they want with short-term loans.
The Philippines is no stranger to this struggle, and with the emergence of PawnHero, it’s become much easier to manage finances when emergencies arise. Take the chance to try out one of the Philippines’ trusted online pawnshop.