Goings on in the world of the pawnbroker could be looking up, after the National Association of Pawnbrokers launched a nationwide advertising campaign aimed towards middle-income households. Their research claimed that the number of middle income people using pawnbrokers had grown from 3% to 8% in the last 5 years, and that 25% more individuals would use the service if they understood how it worked. Online pawnbrokers/lenders Unbolted have burst onto the scene as an appealing start-up business based in London. Founders Rito Haldar and Ashwin Parameswaran created what is, in a way, an online pawn shop. There’s every reason to be proud of their work, and initial customer figures are very promising.
Rito described his start-up in the following way, ‘We set up Unbolted because we want to challenge the way people can access credit through the out-dated pawn industry and other secured lenders. We’ll do that by being transparent, offering fairer terms, cheaper rates and a convenient, easy-to-use online service that puts consumers firmly in control of their borrowing. Would-be borrowers can apply for secured loans – at market leading rates – against anything from gold to fine art, antique cars to grand pianos, simply by uploading a picture of their item to Unbolted’s website‘.
The company, ‘unbolted.com’ uses the traditional ideas of a pawnbroker and modernizes it by putting it online. The overriding aim could well be to make pawn a mainstream financing alternative in the UK, and if focus is low on value, fairness and transparency it’s no pipe dream!
Ashwin and Rito speak keenly about wanting to ‘shake up’ the short-term secured credit market, and are doing so by offering rates that are under half of what is offered by their competitors. It’s obviously a risky business plan, but so far it seems to be working with a ‘wave’ of interest already present in the company’s first year. Examples of loan deals done by Unbolted thus far include £700 to a musician against his £1000 guitar, and a loan of £4,000 against a piece of contemporary art.
As mentioned previously, customers of Unbolted are recommended to send a photo of the item they wish to send the company, so a provisional loan agreement can be drawn up. Actual funds can be sent to the user’s bank account within a couple of hours of Unbolted receiving the item. Co-founder Ashwin Parameswaran said ‘We use a peer-to-peer online model which strips out many costs and ensures our customers can benefit from lower rates than typical larger loan companies or pawnbrokers’.
One key aspect of providing or receiving loans in this way is that, in the same way as pawnbrokers have always operated; there are no credit checks as the loan is secured against the asset. This means that individuals with bad credit ratings who may not have been able to get a loan from a high-street bank can use the services provided by Unbolted.