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Pawnshops Philippines: The Full Guide

Pawnshops have become part of the daily lives of many Filipinos as they provide immediate access to cash anytime. Pawnshops, also known as ‘sanglaan,’ offer quick loan services in exchange for valuable items. Aside from that, they have become remittance and payment centers, making it easier to send money online and settle bills. If you haven’t built a good credit history yet but need to borrow money, pawnshops are good alternatives to banks and lending companies when you apply for a loan.

Undeniably, pawnshops have made it easy for Filipinos to take less complicated cash loans that don’t require much documentation. If you’re looking to compare the best pawnshops in the Philippines, especially their products and services, this guide will walk you through everything you need to know about pawn shops, including the loans they offer, interest rates, payment terms, and other financial services.

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Written by: Big Piggyy

Verified by: Krisette C.L

Krisette C.L

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Krisette has been hustling online media industry since 2011. She's a copywriter, editor, and online media consultant.

Rating

4.2/5
Cebuana Lhuillier

Helping you create a better tomorrow

Rating

4.3/5

Loan Term

1 to 120 days

Est. APR

% 40.72 - 52.89

Loan Amount

Depends on the value of pawned item(s)

Rating

3.9/5

Loan Term

Varies

Est. APR

% 2.99/month

Loan Amount

Varies

What Are Pawnshops? 

 

In ancient China, 3,000 years ago, pawnbrokers introduced the concept of pawnshops to peasants as a way to offer short-term credits. Pawnshops became a trend in Greece and Rome, and many citizens began to embrace them until they became mainstream.

 

However, in the Middle Ages, the Catholic Church imposed limits on pawnshops because pawnbrokers charged exorbitant interest rates. Pawnbrokers later proved that this practice is a viable way to access funds to address start-up businesses’ needs and serve as financial aid to the poor.

 

In 1896, the first pawnshops emerged in the Philippines when Doña Filomena Concepcion de Tan Bunting realized her dream of opening a pawnshop and built Agencia de Empeños, which was considered the first private lending institution in the country. As the only lending institution, it quickly grew and attracted more patrons. 

 

Over the years, pawnshops have evolved into what they are now and have dominated the Philippine market offering various services, including money transfers, bills payment, prepaid top-ups, and quick cash loans, to name a few.

 

pawnshop

 

Pawnshops Business Model

 

When people look for immediate cash financing with less documentation, they can apply for a loan from loan sharks or pawnshops. Of the two choices, the latter is still a better option because it’s legal and has reasonable loan terms. The borrower applying for a quick cash loan will only consider the collateral required for the transaction. 

 

Pawnshops make money through the interest charged on the collateral. When the borrower brings valuable items, the personnel from the pawnshops appraises their value and decides the amount they can loan to the borrower. 

 

The interest amount charged to the borrower is from 3% to 4% per month of the loan amount. The loan tenure is up to three months, and it’s renewable. Upon due date, the borrower pays for all the interest charges accrued, and when he’s ready to redeem the pawned item, he pays the loan amount and the accumulated interest to date. 

 

In general, pawnshops prefer jewelry as pawnable items, but now they also accept a wide range of items, including gadgets, appliances, electronics, and even cars.

 

Why Should You Consider Using Pawnshops?

 

Pawnshops are the best option for people who need immediate funds, but they lack the required documentation for loan processing. Here are some of the advantages when you apply for a loan using pawnshops:

 

They Provide Instant Cash Access

Traditional banks can’t provide immediate cash to borrowers who lack the proper documentation. In contrast, pawnshops can give borrowers instant cash on the spot in exchange for valuable items as collateral, and the loan amount is equivalent to the appraised value of the items.

 

Easy and Fast Process

Borrowers only need to present the pawned items and one valid government-issued ID. The pawnshop personnel appraises the pawned items and provides the borrowers with the amount they can receive. If the borrowers agree to the price, they will receive cash and sign the terms and agreement of the loan. This process is straightforward and will only take a few minutes. 

 

A Good Credit History is Not Required

Pawnshops don’t require a credit check when borrowers apply for a loan because the cash they receive will depend on the value of the pawned item. If he can’t pay or redeem the item once the loan term expires, the pawnshop has the right to do whatever it pleases with the pawned item.

 

All Transactions are Legal and Safe

The pawnshops in the country are regulated by the Bangko Sentral ng Pilipinas (BSP) and operate legally. They comply with the regulations by charging reasonable rates and imposing realistic terms and conditions. Additionally, they can’t share customers’ personal information with third-party companies. 

 

When Should You Consider Pawnshop Services?

 

Some circumstances warrant a person to resort to pawnshop services for quick loans instead of going to banks or other financing companies. For the most part, these are due to the following reasons:

 

Emergency Need for Cash

When the savings are insufficient to cover the emergencies such as hospitalization, some people will opt for quick cash loans to settle hospital bills and other medical fees. For example, a family member admitted to a private hospital must pay for the downpayment and additional admission fees. Banks can only release loan proceeds for a couple of days, whereas pawnshops can give you the money on the spot.

 

People hit by calamities need immediate funds to fix their homes and restart their businesses. Quick cash loans from pawn shops can be their option, too. Typhoons and other natural disasters often leave destruction in poverty-stricken areas, and recovery starts when there’s access to funds to buy raw materials for the reconstruction of houses and other establishments.

 

Unemployed and Lack Requirements

Those who have recently lost their jobs or do not meet the minimum salary requirements to avail of a loan will find themselves in a predicament, especially when submitting the required documents. Pawnshops can remedy this problem, and although the borrowers need their valuable possession, necessity will push them to take a loan with pawnshops instead. They rest in knowing they can redeem their item once they have the money.

 

Retrenched employees aren’t exempted from facing financial emergencies. The only option they have is to borrow money from loan sharks and pay high-interest rates or choose pawnshops and transact legally. 

 

Bad Credit History

Bad credit history will likely affect the borrower’s chance of getting his loan approved, especially in banks and other financial institutions. When borrowers apply for a loan, a credit check is a must regardless of the circumstances. Bad credit history will lead to the rejection of the loan application of the borrower. 

 

Short-Term Need for a Loan

The terms usually stated in a quick loan through pawning are only for a short-term period. In general, pawnshops offer three months loan tenure, and the borrowers have the option to extend their loan as long as they pay for the interest due. 

 

Items for Collateral for a Pawnshop Loan

 

When pawnshops first conducted their operations, most items received as collateral were jewelry because of their high value. Over time, the list of acceptable pawning items has been expanded, and borrowers have other options such as:

  • Gold
  • Diamond
  • Platinum jewelry and watches
  • Cellphones
  • Laptop computers
  • Car Title or OR/CR
  • Land Title
  • Luxury Items
  • Appliances
  • Artwork

 

Some items that depreciate fast, such as gadgets, cellphones, appliances, and other electronic devices, will have a lower appraisal value. Jewelry, OR/CR of vehicles, artwork, and land title will have a higher appraisal value. 

 

Loan Process Through a Pawnshop

 

The loan process throughout all the pawnshops in the Philippines is more or less the same. Borrowers must bring the item they want to pawn, a valid government-issued ID, and visit the nearest pawnshop, and they need to wait for the pawnshop personnel to facilitate the transaction. 

 

Borrowers who present the collateral for appraisal must fill out a form with their personal information. Once the personnel from the pawnshop completes the assessment, he will inform the borrowers of the appraised value equivalent to the loan proceeds, the interest rate, and the loan term.

 

The borrowers receive the net proceeds of the loan. Therefore, the pawnshops will deduct the processing fees (and in some pawnshops), including the first month’s interest. Within the loan duration, the borrowers can claim the pawned item and pay for the loan amount plus any accrued interest or extend the term of the loan and pay only for the interest due. 

 

If the borrowers are ready to redeem the item, they only need to bring the pawn ticket, a valid government-issued ID, and the cash for the full payment.

 

Online Pawning

 

Not everyone feels comfortable visiting pawnshops and carrying their items, and some are too heavy and impossible to bring to pawnshops for appraisal. That’s why some pawnshops have developed a way of making online pawning possible. 

 

As the name suggests, online pawning is entirely online, and a person will only need a laptop or smartphone to get started. One can visit any of the online pawnshops available in the Philippines and create an account. 

 

Next, an online pawn ticket must be created detailing the information related to the pawned item and schedule a pick-up for the item. Within 24 hours, personnel from the pawnshop will pick up the item for an appraisal. Once done, the borrower will receive the loan agreement with the terms. 

 

After the borrower accepts the offer, he or she can cash out the loan proceeds through any of these methods: bank transfer or any InstaPay and PESONet partner banks and electronic money issuers. 

 

List of Pawnshops in the Philippines

 

There are many pawnshops in the Philippines today – some more well-known than others. However, those that have already been around the country for decades are still the most trusted and preferred establishments today. 

 

Name Of PawnshopAcceptable ItemsInterest RateService Fee
Cebuana Lhuillier

(available nationwide)

  • Gold
  • Diamond
  • Platinum jewelry and watches
  • Cellphones
  • Laptop computers
4%₱5.00
M Lhuillier

(available nationwide)

  • Gold and Diamond Jewelry
  • Cellular Phones
  • Laptops/Macbooks
  • Tablets/Ipads
  • Cameras
  • Kitchenware
  • Silverware
  • Home Appliances
  • Cookware
  • Ray-Ban Sunglasses
  • Power Tools
  • Guitars
  • Medical Equipment
  • Bicycle
  • Nintendo
  • Sewing Machine
  • Watches
  • Motorcycle
  • Car
Starts at 3%₱5.00
Palawan Pawnshop

(available nationwide)

  • Only gold jewelry items
1% to 3.5%one percent (1%) of the principal loan, but shall not exceed five pesos (₱5.00)
RD Pawnshop

(available nationwide)

  • Gold Jewelry
    • Bracelets
    • Earrings
    • Necklaces
    • Pendants
    • rings
  • Gold bars
  • Watches (only these specific brands)
    • Rado
    • Rolex
3%one percent (1%) of the principal loan, but shall not exceed five pesos (₱5.00)
Tambunting Pawnshop

(available nationwide)

  • jewelry
  • household appliances
  • gadgets
  • cars and motorcycles
  • photo and video equipment
  • watches
  • bicycles
4%none
PawnHero

(available nationwide)

  • Jewelry
  • Designer Bags
  • Watches
  • Laptops
  • Gaming Consoles
  • Cameras
  • Smartphones
  • Tablets
  • Televisions
  • Sunglasses
  • Soundbars and Speakers
  • Belts
  • Designer Shoes
Gold and Jewelry – 3.5% or ₱500 whichever is higher

Designer bags, luxury watches, gadgets, and other items – 4.99% or ₱500 whichever is higher

one percent (1%) of the principal loan, but shall not exceed five pesos (₱5.00)
Villarica Pawnshop

(available nationwide)

  • Gold, diamond, or platinum jewelry
  • Watches
  • Mobile phones
  • Laptops or computers
4% – 6%none
N-Cash

(Only available in Greater Manila Area)

  • Watches
  • Designer Bags
  • Laptops, Notebooks, Desktops
  • Smartphones
  • Other Gadgets
  • Camera Body, Lens, and Accessories
  • Gaming Consoles
  • Vehicles
  • Motorcycles
  • Jewelry
  • Designer Shoes
  • Sneakers
  • Rimowa Luggage
  • Sunglasses and Other Eyewear
3% – 10%1% of the principal amount
CVM Pawnshops

(available nationwide)

  • Jewelry
  • Cellphone
  • Gadgets
  • Smart TV
Jewelry – 3.5%

Cellphone – 10%

Gadgets – 15%

Smart TV – 15%

Not available
Dalton Pawnshop & Jewelry, Inc.
  • Jewelry
  • Cellphone
  • Laptop / Ipad / Tablet
  • Home Appliances
  • Motorcycle
2% – 5%Not available
M. B. Aguirre Pawnshop

(available only in Metro Manila)

  • Jewelry 
  • Electronic Gadgets
3%Not available
GRJ JARO Pawnshop CORP.
  • Jewelry
  • Gadgets
Not availableNot available
Ros-Ver Pag-Asa Pawnshop

(available in Davao)

  • Jewelry
  • Watches
  • Electronic Gadgets
  • Appliances
  • Game Consoles
  • Power Tools
  • Musical Instruments
5% – jewelry, watches cellphone

6% – bulky items (appliances, power tools, computer, etc.)

one percent (1%) of the principal loan, but not exceeding five pesos (P5.00)
PTS Gadget Pawnshop

(available in Metro Manila)

  • Gadgets
3% – 6%one percent (1%) of the principal loan

 

The general requirements needed at any of these pawn shops to pawn an item are a valid government-issued ID, an active mobile number, and a completely filled-out form.

 

The table above shows that jewelry has a lower interest rate than other valuable items. Some pawnshops in the Philippines do not just function as pawnbrokers but also offer other services such as remittance, money transfer, bills payments, currency exchange, etc. 

 

General Requirements and Documents Needed for a Pawnshop Loan

 

When the borrower is ready to get a quick cash loan from pawnshops, there is no need to prepare a long list of documents to get approved. He must bring the following:

 

  • A valid government-issued ID
  • Pawned Item(s)
  • Active mobile phone number

 

These three requirements are what make pawnshops an easy way for people to come up with the needed cash – the requirements are straightforward and simple. When a person has a valuable item for collateral, he or she may be granted a quick cash loan in a few minutes, provided that the pawnshop accepts the collateral. 

 

Most pawnshops have websites that contain a full list of accepted items. It is always better for a person to know what the pawnshop accepts as collateral before visiting them. 

 

Tips for a Pawnshop User

 

Those who are interested in pawning a valuable item in exchange for a quick cash loan must understand the processes and costs involved in pawning. As with all types of financing, borrowing money has a cost attached to it. 

 

Know How a Pawnshop Works

When pawning an item or items, the person in need of a quick cash loan must understand the whole process of how a pawn shop works. Essentially, a pawn shop is the same as financing companies and banks by making money through the interest charged. However, the terms and conditions will differ. Hence, it is essential that all questions related to interest rates, penalties, loan renewal or extension, and even claiming the pawned item have to be asked first prior to signing anything. 

 

Understand That a Cash Loan From Pawnshops Is Only for Short-term

Pawnshops charge daily interest on the loan amount received. This means that when the borrower foresees that he or she will not be able to make a payment within a three-month to a 12-month period, the interest payments will definitely hurt the borrower significantly if the loan value increases. 

 

One must always assess the cost of borrowing especially when the interest accumulates. Some people sometimes resort to loan renewals by paying for the total accrued interest at maturity. Over time, when a person constantly has to pay for interest, it becomes more expensive than applying for a loan through a bank.  

 

The Appraisal Value Will Not Be Equal to the Purchase Price of the Item

The cash proceeds received will be based on the appraisal of the pawned item. Some items are more valuable than others. Those who pawn electronic devices and appliances will receive a lower appraisal value as compared to jewelry and other luxury items because it depreciates faster and loses their value in the long run. 

 

Other factors are also checked during the appraisal, including the condition of the item pawned and its ability to be sold. If these conditions are barely met, a person will only be able to get a small amount of loan. 

 

Not All Valuable Items are Accepted

Pawnshops have a list of pawned items that they can accept. Just because a person views his or her valuable item as having “value”, the assessment from pawnshops may not be the same. It is always better for a person to check the list of acceptable items of a pawnshop first before bringing their item to the shop. 

 

A typical case would be a newly bought gadget compared to jewelry. Jewelry – especially precious metals – typically have a higher appraisal value even if the purchase price of the gadget is higher than the jewelry. 

 

Fake Items Brought to Pawnshops

 

Some people, desperate to take a loan, would resort to bringing fake items to pawnshops. And although most pawnshops have fool-proof ways of identifying fake items, there are instances when some items look real and are able to pass and get appraised. 

 

If the borrower must not intentionally bring fake items as collateral because the pawnshop will block him or her from conducting business with the shop due to trust issues. If later on, the pawnshop discovers that the item is fake, immediate payment will be due from the loan, or in worst-case scenarios, a case will be filed against the person if the shop finds out that the person deliberately fooled the pawnshop. 

 

Some people believe that their item could be valuable but later on find out that it is not, especially in the case of heirlooms. Although some items could have been passed down from generation to generation, their worth doesn’t guarantee a higher appraisal. 

A typical scenario of how item owners and pawnshop personnel spot fake items can be seen here.

Frequently asked questions

Why is there a need to test my item during pawning?

Since the pawned item(s) are a form of collateral, the pawnshop needs to know if they will be able to receive something out of the pawned item should the borrower fail to redeem the pawned item within the period stated in the pawn agreement. This is especially for gadgets – they must be in good working condition at the time of pawning. 

What is a pawnshop?

Pawnshops loan money to people in exchange for valuable items as a form of collateral. They have employees who appraise the value of the items brought in and provide cash after deducting advance interest (in some cases) and the service fees. 

Which pawnshop has the highest appraisal?

Pawnshops will use different appraisal criteria on items brought in. The appraisal will also depend on the collateral items. 

What pawnshop accepts watches?

Most pawnshops in the Philippines today accept watches but only of certain luxury brands. While some watches may be expensive, not all expensive brands can be brought in as collateral. It is always best for a person to check with the pawnshop in advance and whether they accept the brand they own. 

How to start a pawnshop business in the Philippines?

Without a doubt, starting a pawnshop business in the Philippines is a lucrative investment. Those who are interested to start a business can choose whether they want to start as a sole proprietor, partnership, or corporation. 

 

To start a pawnshop business, the necessary permits need to be secured such as the following: 

 

  • Accomplished Business Name Registration Form from the Department of Trade and Industry
  • Mayor’s / Business Permit
  • Tax Identification Number (TIN) from the Bureau of Internal Revenue (BIR)
  • Social Security System (SSS) Certificate
  • Registration with the Department of Labor and Employment (DOLE) if with 5 or more employees
  • Approval granted by the Bangko Sentral ng Pilipinas (BSP)
How do pawn shops appraise jewelry?

There are conditions pre-set by the pawnshop when it comes to appraising jewelry. Among them are the following: base value on the current appraisal value in the market, the condition of the pawned item, and its sellability. This is why jewelry has a higher appraisal value than other valuable items. 

What pawnshop accept silver?

Any of the pawnshops in the Philippines that accept precious metals will accept silver. 

How do pawnshops appraise gold?

There are three items that pawnshops check when they appraise for gold. They are the following:

  • Purity of gold (18k, 22k, or 24k)
  • Weight of gold
  • Current price of gold
Can I still renew or redeem my item even if I lost my pawn ticket?

Yes. Most pawnshops now have digital records of the pawn. In case a person loses their pawn ticket, they can visit the branch and provide a valid government-issued ID and other information that might be required. However, one must ensure that the term of the pawn agreement has not expired yet.

Are my pawned items safe while being in a pawnshop?

Yes, pawn shops keep pawned items in a fire-proof vault and have 24-hour security and CCTV cameras. A person who decides to pawn their item can also ask pawnshop personnel about the measures they take to keep the pawned items safe. 

What happens to a foreclosed item?

Foreclosed items become available for sale or available for disposal by the pawnshop. There are rare cases when a person whose item has been foreclosed was able to reclaim it. Some pawnshops in the Philippines have jewelry shops – making it easy for them to melt precious metals to make new jewelry. Other items such as gadgets, vehicles, appliances, etc., become available for sale. 

Can anyone redeem the item on behalf of the pawner?

Yes, it is a common practice in the Philippines that another person with a valid government-issued ID and the pawn ticket can redeem the pawned item. 

How will I get my money after pawning an item?

Once the agreement has been signed with the terms and conditions, the proceeds of the loan through pawning will be received over-the-counter if the process was done through any of the pawnshop branches. If the pawn was done online, a person may receive the proceeds through a bank or e-wallet transfer. 

How do I redeem my pawned item?

To redeem a pawned item, the pawn ticket will be required to be presented to the pawnshop along with a valid government-issued ID and the total payment due – principal loan amount and any interest due. 

Can I extend my loan?

Yes, an extension of the loan is possible. One must visit the branch with the pawn ticket, pay for the accrued interest as of the date of extension, and pay for the total amount due. A new pawn ticket will be issued with the new term of the loan. The interest rate does not change when a loan is renewed or extended. 

Conclusion

 

Pawnshops have become a crucial part of every Filipino’s life when they meet financial difficulties that need to be addressed immediately. And while many avoid pawnshops due to the high-interest rates they charge and the short loan terms, they provide the easiest and simplest way for people to have immediate access to cash to take care of pressing matters – especially medical emergencies. 

 

Before one starts using pawn shops for their financial needs, they must first understand how the entire process works and the cost that people have to anticipate regarding their pawned item. 

Big Piggyy

"Show me the MONEY!!!" – Jerry Maguire

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