With the credit crisis tightening, pawn shops are thriving.
     Post business reporter SHAUN GREANEY investigates an old industry.
     THEY carry a Dickensian image of mother pawning father's best suit for a paltry sum.
     But pawn shops are doing good business as people begin to feel the pinch from the credit crunch, although some are surprised that they still flourish in 21st Century Britain.
     The roots of pawnbroking go back to ancient China, and the symbol of the trade - three gold balls - was part of the Medici family crest in 15th Century Italy.
     In the late 1800s, there were nearly as many pawnbrokers in Britain as there were pubs. But after the Second World War, the number declined as the welfare state and greater job security arrived.
     Today's successful pawnbrokers owe a lot to the Consumer Credit Act of 1974, which updated the 1872 Pawnbrokers Act.
     It led to a revival of pawnbroking at the time of the 1980s credit boom.
     In the economic downturn of the early 1990s the pawnbrokers flourished.
     In Swansea, The Money Shop has been operating on The Kingsway since September 2004.
     Director Ray Tilley Jr says the credit crunch has had an effect.
     "There has been an increase, although we have been busy from day one here," he said.
     "I wouldn't say we have had a massive increase, although there definitely has been some extra activity since the turn of the year.
     "It may well be due to the credit crunch."
     Around ten people a day turn up at the shop with items to pawn, mainly jewellery.
     The bulk of the trade is people who are in financial difficulties looking to get back their cash or those facing sudden unaffordable bills.
     "The type of items we get vary, from the basic cheap rings and at the other end of the scale we have expensive items which would retail for several thousand pounds on the high street if they were new.
     "It's not just people out of work who use the service.
     "It can be people holding down regular jobs, falling a bit short and needing to raise cash in the short-term," said Mr Tilley, who runs the Money Shop with his father, also named Ray Tilley.
     "The shop is a franchise. The Money Shop themselves have a lot of units which they own and operate throughout the country."
     The National Pawnbrokers Association said there are about 800 pawnbrokers in the UK, and the number is growing at about 10 per cent a year. Mr Tilley said the service was popular for a number of reasons.
     "It's quick, it's immediate. For people falling short on their rent, it is a quick solution.
     "Also, the interest is fairly low and if they redeem items, it's kept to the basic interest.
     "We hold items for seven months and interest accrues on that," he said.
     "But there is a bit of a stigma attached to pawnbroking."
     Des Milligan, head of the National Pawnbrokers Association, said: "Many people don't know how it works, and once they realise that a pawnbroker is not trying to keep their things and flog them, they are willing to give it a go.
     "Today, most pawnbrokers only lend money against gold and diamond jewellery - electronics lose value too quickly as new brands come in."
     Data comparison website Moneynet.co.uk said consumers cut off from credit by wary lenders in the aftermath of the credit crunch could be forced to live in a cash economy that is seeing a revival of money lenders and pawnbrokers.
     The company said it is not just the previously borderline creditworthy who are facing a radically different financial landscape.
     A new generation of financially disadvantaged consumers is predicted to emerge as the effect of the credit famine leaves a stain on their records, said Moneynet.co.uk's Richard Brown.
     "Many borrowers with an adverse credit history, who last year would have found it relatively straightforward to access mortgages, loans and credit cards, are now finding themselves pushed out altogether, while a new generation of bewildered borrowers takes their place in the adverse market," he said.
     "But with the rise in inflation threatening future interest rate rises, and the cost of everyday necessities still climbing, deciding to live according to their means without borrowing is simply not an option.
     "A great many ordinary consumers are going to have to find some way of borrowing in order to survive, and that will mean making decisions that are likely to lead to even more debt and hardship."
     Chris Tapp, director of debt charity Credit Action said compared to doorstep lending and high interest loans, pawnbroking can be a ready source of cash at a lower cost.
     With around three million Britons not having bank accounts and many more finding it hard to get credit cards and overdrafts because of poor credit ratings, the pawnbroker can offer a solution.
     Mr Tapp said: "If you need a small amount of cash for a short time, like if your boiler breaks down, it can be a decent option."


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