From yachts to hearses: South Africa’s rich people are pawning luxury items

Watches, cars and art are the most commonly pawned items.

Luxury pawnbroking is on the rise among rich South Africans. Image: iStock

If you thought pawning possessions for quick cash was only for the poor, think again – those that are part of the so-called “one percent” do it too.

Rich South Africans that are cash-strapped are turning to luxury pawnbroking for instant cash, trading their precious possessions for quick loans.

“Pawnbroking offers our wealthy clients an effective plan when their cash flow is a little thin, albeit reliable and is a viable alternative option,” said Lamna co-founder and CEO, Charles Meyerowitz.

Lamna said it had observed significant growth in the number of people pawning their luxury goods for short-term financial relief.

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

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‘Yachts, watches and hearses’

So, what exactly have rich people pawned for instant cash?

Unsurprisingly, luxury watches, cars and art are the most commonly pawned items among Mzansi’s elite.

While luxury cars valued up to R5 million have also been spotted, the broker said smaller luxury items are usually pawned for between R30 000 and R350 000.

However, large and unusual possessions have also landed on the pawn registry as security for the often pricey loans.

“We’ve even had a yacht and hearse come through our doors,” said Meyerowitz.

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Why the interest?

While the rich may be more comfortable to sail through the tough economic tide, they’re not immune to the impact.

“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,” Meyerowitz explained.

He attributed the growth in luxury pawnbroking to the convenient access to cash it presents for the wealthy.

“More often than not we’re advancing loans against luxury goods to our clients who require fast access to their money mainly for business and on occasion for personal reasons,” he said.

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