Hardcore pawn for rich South Africans

 ·24 Feb 2024

Luxury pawnbroking is on the rise as wealthy South Africans have not been spared from the nation’s economic challenges.

Lamna Financial said that cash-strapped professionals are turning to discreet luxury pawnbroking to combat their financial woes and unlock liquidity in their assets.

“In the last year, we have seen a 20% increase in first-time clients and a 30% in the value of our loan book for the same period,” said CEO of Lamna Charles Meyerowitz.

“We’re seeing a massive increase in our services, specifically when it comes to pawning luxury items. I think everyone will agree that in the current economic climate, liquidity is spread thin.”

“Around 28% of all our loans are secured against luxury watches, cars and art, and we’ve even had a yacht and hearse come through our doors,” he said.

Smaller luxury items are usually valued between R30,000 and R350,000, while some luxury cars come in at over R5 million.

Meyerowitz said that the group is advancing loans against luxury goods as clients require fast access to their money mainly for their businesses and sometimes personal reasons.

“The sharp rise in interest rates, and stringent lending requirements from the banks make traditional banking route mostly unattractive for our clients, especially when they’re sitting with lazy assets that can create liquidity fast through a pawnbroking service,” he said.

He added that lending policies for banks have become a barrier for their clients, with many of their clients’ businesses reliant on large government contracts and tenders.

“These entrepreneurs, or SMEs, often have contracts worth millions of rands, but processing on payments of these contracts often fall short of their deadlines.”

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