Everything you need to know and more about the Pawn Business.

The pawn industry actively employs over 28,000 people and there are over 10,000 operating pawn stores across the United States. Just like The Pawn Company 81% of the shops are independently owned small businesses. Pawn Shops Today reports “collateral loans, also known as pawn loans, remain the core of pawnbrokers’ businesses, with over 80 percent of pawnbrokers reporting that pawn loans are the most common transactions.”  These loans are non-recourse, short-term, collateral-based loans that have no effect on a consumer’s credit history.

  • No pawnbroker can demand repayment of funds advanced.
  • No credit checks on customers or reporting to consumer credit agencies
  • Typically small-dollar advances, the average pawn loan is $150

Pawnbrokers are licensed by state and local governments that also conduct examinations to insure compliance with laws that govern every aspect of pawn transactions, including all fees and charges, loan durations and grace periods, recordkeeping, and transaction reporting requirements.  Pawnbrokers’ customer identification programs mandated by state and local laws are more comprehensive than the USA Patriot Act requirements. For every transaction pawnbrokers require the consumer’s valid, government issued picture agencies at the state and local levels. This helps diminish disputes which are as few as 10 items out of 10,000.

The pawn industry is the most heavily regulated provider of consumer financial services. A total of fourteen federal laws govern pawn transactions, including the Truth in Lending Act, Gramm-Leach-Bliley Act, Service members Civil Relief Act, and the USA Patriot Act.

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