Reality TV And It’s Positive Effect on the Image and Industry of Pawn Shops Original article on reuters.com
(Reuters) – After centuries on the fringe of consumer finance, the neighborhood pawn shop is pushing its way toward the mainstream, thanks to the power of reality television and the long arm of government regulation.
The History Channel’s hit show “Pawn Stars,” featuring a Las Vegas shop run by three generations of the quirky but endearing Harrison family, has helped transform the image of the pawn shop, portraying it as a fun place to do business and discover one-of-a-kind buys.
At the same time, more consumers, even those with other loan options, are finding that the simplicity of the pawn shop has its appeal.
“I have been coming to pawn shops for years but I guess the TV shows makes it easier, you know, more acceptable,” said Eddie, an unemployed Texan who asked to be called by his first name, after he pawned a diamond ring for $250 at EZ Pawn in Austin.
“The big change in the industry has been the mainstreaming of the image,” said Emmett Murphy, spokesman for the National Pawnbrokers Association. “It opened the doors for America to come into their pawn shops to see what it is about.”
The makeover, combined with a pending government crackdown on exorbitant payday loans that are geared to people on the low end of the income spectrum, have made these heady days for one of the world’s oldest forms of consumer finance.
Pawn shops, with their three golden balls symbol, much like barbershop poles, have been readily identifiable in the United States since the 17th century.
They extend loans on an item of value, say, a ring or a guitar, brought in as collateral. If the loan and interest are paid off on time, the item is returned to the borrower. If not, the pawnshop can sell the item and pocket the proceeds.
“Customers tend to use us when they need us, redeem their merchandise and we won’t see them for a number of months … and then we see them again,” said Larry Nuckols, 60, chairman and co-owner of Money Mart Pawn & Jewelry, with 26 stores in Texas and four more in two other states.
Pawnbrokers expect an increase in loans this year, according to a National Pawnbrokers Association industry survey, although most are doubtful of seeing much growth on the retail side of the business, where unclaimed goods are sold.