New figures from the National Pawnbrokers Association (NPA) show that the pawnbroking industry grew by 8 per cent last year, outstripping performance in most other business sectors, despite the falling price of gold. There are now 2,144 pawnbrokers in the UK operating in a market worth £865 million.
The pace of growth has slowed compared with recent years - down from 15 per cent in 2011/12. This is primarily due to drop in gold prices, which have fallen by 20% over the same period. However, lending to businesses remains strong as the pressure continues on those who cannot access bank loans. The average loan to businesses is £2,000 to £3,000 and is now typically used to make short term payment to creditors or staff rather than for business development.
More jewellers are turning to pawnbroking as they look to expand the services they offer in these difficult times - over the last 12 months the NPA has seen the number of jewellers moving into the pawnbroking industry double compared to the previous period.
NPA Chief Executive, Ray Perry, said:
‘Clearly the market has taken a hit from the recent drop in gold prices but is still growing strong. High end and business customers continue to drive growth and more and more jewellers are embracing the pawnbroking model.’
‘Customers are being more careful in balancing their household expenditure and managing money well with part payments on the increase. People are becoming more savvy with their assets, using items such as art, antiques, watches, and cars against pawns with a new breed of pawnbrokers rising to meet that demand.’