Pawnshops will even take ladders during the Covid epidemic
published : 7 May 2021 at 17:39
SONGKHLA: You can find almost anything at a pawn shop — from gold necklaces to a ladder — when the coronavirus hits people's purses.
The pawnshop run by Hat Yai Municipality on Friday put on display goods hocked by cash-short customers. They ranged from small items like gold adornments to bicycles, air pumps and even an aluminium ladder.
Manager Taweewong Wongchuay said his staff would normally have rejected stuff like the ladder as collateral for a loan. But in extreme times like this, when many people were strapped for cash because of Covid-19, they had to be more flexible.
"The pawnshop tries to help everyone. We tend to take most things that people try to pawn," he said. "This aluminium ladder was about 500 baht."
The municipal pawnshop in this southern business hub has seen a 50% increase in customers since the latest virus surge, to about 150 a day.
It stocked up with almost 132 million baht in cash to cope with the growing number of clients.
Songkhla province is 10th on the list of provinces with infections since the latest outbreak began in early April, with 797 cases as of Friday.
One woman who came into the shop on Friday was there only to pay interest on money loaned against her gold necklace. She said pawning it was the only thing she could do during this difficult period.
"My income dropped. In fact, it has dropped since the first outbreak," she complained.
Pawnshops in other provinces, and in Bangkok, are experiencing the same trend of increasing numbers of customers, and even more so with the opening of the new school year drawing near.
The weeks just before students return to school are a peak period for all pawnshops, even in normal times.
Somkasem Songphoklang, who manages a pawnshop run by Muang Nong Khai Municipality, said on April 28 that business was increasing, with more people coming in for cash advances. He had stocked up with cash, and had about 150 million baht ready to distribute.
Interest rates charged by state-run pawnshops and those operated by local administration organisations vary, but they are cheaper than private pawnshops.
Pawnshops under the Social Development and Human Security Ministry might charge 25 satang (0.25%) per month for a loan under 5,000 baht, and those run by local governments might charge 50 satang for the same amount, for example.
At the other extreme, private loan sharks charge exhorbitant rates - for example, a 2,000 baht loan over 20 days may incur interest of 25%, deducted immediately, with repayments at 100 baht a day on the full principal.