This Day, That Year

Item from Aug 22, 1999, in China Daily: Pawnshops are flourishing in China.

Statistics indicate that individual customers make up 95 percent of pawnshops’ clientele, contributing to about half of the business volume. Another half comes from small and mediumsized enterprises.

Since the first pawnshop on the Chinese mainland was opened in Chengdu, Sichuan province, in 1987 after China’s reform and opening-up in the late 1970s, pawnshops have played an important role in helping small businesses survive hard economic times.

They have been filling a financing gap by lending to small and medium-sized companies to support the country’s private sector.

There are about 8,280 pawnshops nationwide, up from 4,000 in 2009, according to the China Pawn Association.

From gold bullion to houses and factory equipment, customers are offering all sorts of assets to get loans from pawnshops.

In 2009, Huaxia Pawnshop Co teamed up with a credit guarantee institution and Bank of Communications, to target small and medium-sized businesses.

Under their joint project, Bank-Pawn-Expressway, a borrower can get a quick loan from Huaxia Pawnshop to meet urgent funding needs and then repay the pawnshop once they obtain a lower-rate bank loan with guarantees.

In the internet age, online pawnshop market places such as Taodangpu and 51dang have been booming in recent years. 51dang essentially functions like a peer-to-peer lending website, while Taodangpu is the online store where those goods are sold if the users can’t pay back their loans.

It also offers expert assessments of all the items and a seven-day return policy.