1. Call Bangko Sentral ng Pilipinas (BSP) pawnshop hotline, (02)524-8713, to check if the pawnshop name you want is already taken.
2. Register your business either at the Department of Trade and Industry (DTI), for single proprietorship, or the Securities and Exchange Commission, for partnerships or corporations.
DTI is located at the Trade & Industry Building, Sen. Gil Puyat Ave., Makati. In the provinces, DTI offices are in or near municipal buildings. Application forms are also available at DTI’s website. Only Filipinos may own a pawnshop organized as a single proprietorship. For partnerships and corporations, foreign ownership should be limited to 30 percent.
3. Secure a business permit from the city or municipality where pawnshop will be located.
4. Register with the BSP. For the complete list of requirement, download the form here. These include permits from the DTI or SEC and the local government, an information sheet, personal data sheets, bank certification of at least P100,000 capital and location sketch.
5. Pay the processing fee of P1,000.
6. It will take two to three weeks for the BSP to process your application. Make sure you open your business within six months after the application is approved or your permit will be revoked.
FAQ - Nature of Pawnshop Business
1) What is the nature of Pawnshop Business and the Pawnshop Industry in the Philippines?
In observing the growth of micro enterprises in any Philippine cities and town areas are one of the sign that people nowadays wants to have additional income due to the rising prices of basic commodities and services, accompanying the implementation of Value Added Tax (VAT) and the unpredictable increase of crude oil in the world market to meet the needs of their families. Even the labor sector specifically the employees are in search for things to sell in their offices and work places to augment their income. So even the business and investment sector are now looking for crisis proof business which will entail them a good return on their investment. They don’t want to risk their money to start up business due to ineffective operating systems and knowledge about the market.
But for the Pawnshop Industry, economic crisis is the reason why they are in the business. The people today are learning that they could get a better deal and a better buy in a pawnshop than in a regular retail store. But before we go to Pawnshop Services and Operation let us discuss the Pawnshop’s Nature and its Industry;
The Pawnshop Owner or simply describes as Pawnbrokers (collateral loan brokers) engage in short term credit. This loan is made at a relatively high interest rates based purely on the intrinsic value of the collateral. The business answers the huge loan demand of the people belonging to the low income strata which left unattended by the banking system. The bank usually requires collateral such as real estate properties, salary statements or payrolls, tangible assets like equipments, machines, plant etc., which the middle class does not possess. They also require an arduous and tedious processing which result to untimely release of short-term credit which they needed to pay their over due bills and other financial obligations.
The bank also doesn’t allow small amount of loans ( Php 200.00 to Php 2,000.00) just to pay the said bills, tuition fees and other emergency expenses arises which are not part of the budget allocation for the month.. This economic opportunity – a huge short term credit demand - left unattended in the market by banks and other financial institution made the Pawnshop as the leading grassroots money lender, serving as a source of credit to millions of Filipinos, providing average small-secured loans - Php 200.00 to Php 1,000.00) for a brief time period (2 to 4 months).
In 1999, there was one (1) pawnshop for every 8,756 people in the country and today in the Philippines there are more than 10,000 registered pawnshops and 5,000 pawnshop owners according to the Bangko Sentral ng Pilipinas (BSP) that is up close to 3000 Pawnshop in 2000. This figure far exceeds the number of banks and bank owners in the country.
The BSP and other financial analyst have seen a stable growth rate of 10 -20% in the next several years which means the Philippine Economy can still accommodate 1000 to 2000 new Pawnshops due to the following reasons;
i. HISTORIC GROWTH REGARDLESS OF ECONOMY
Pawnshop does best during periods of high unemployment and tight money when customers seek to convert property to cash. They also do extremely well during periods of economic expansion, when loans tend to be short term and used for meeting unexpected bills for daily consumption, medical expenses, appliance replacement, and home and vehicle repairs.
ii. FAVORABLE LENDING CLIMATE
The Pawnshop Industry is regulated and governed by Presidential Decree No.114 decreed by the late President Marcos in the early 70’s. P.D. 114 has always been favorable to the pawnshop industry. This is the reason why number of pawnshops has increased in previous years.
iii. PROFESSIONALISM AND FRANCHISING
Pawnshop are now manage by Professional Staff and Officers which results to more innovative marketing strategy and customer care that benefits its clientele. It also hires and trains its staff for courtesy and standardized procedures in dealing with the customers particularly those who not been privilege for their education, explaining to them the policies and regulation in entering the short term credit such as the date of expiration and the interest incurred on the said short term loan. Franchising the pawnshop also spear-headed the growth as more interested franchisees wants to invest in pawnshop business, usually amazed with growth of pawnshop in their community, like mushroom sprouting around its corners of the business area. Franchising helps neophyte entrepreneur to achieve success rate of operation and return on their investments at 97% rate compared to 33.33% rate of business success in a trial and error operation system of a starting business.
iv. IMPROVING PUBLIC IMAGE
Sensitive to the historic, unfavorable image of pawnshops, many modern pawnshop operators are striving to win public approval and acceptance. Modern Pawnshop owners are participating in Civic and Religious Organization which has a mission in helping the less privilege sector of society by continuous education in Early Childhood, Earning Additional Income, and Spiritual Nourishment Programs which is vital to regain their dignity and become productive citizens of our society. For instance, SMDC Pawnshop and Jewelry CO., helps the young children of the poor for their Preschool to College Education by sponsoring them in the programs for the poor children and youngsters of Our Lady of Lourdes Catholic Charismatic Foundation Inc. This is part of the social responsibilities being accounted for by the Pawnshop business.
Nowadays, many people see pawnshops as legitimate businesses that pay taxes and hire people, just like other respectable businesses. In the past, the poor reputation was earned, but pawnbrokers have done a good job dispelling those old scenarios and running clean, respectable operations. If the pawnshop owner does not run a respectable pawnshop, most likely he will not make to walk in the ladder of success of pawnshop industry.
source: Jamie Alarcon, Chona Galang, www.inquirer.net, photo from aargon-neon.com
Related Posts:
- MoneyBiz
- How Pawnshops Work
- Business Registration Requirement of Pawnshop
- How Does a Pawnshop Operates
- TRC Training Schedule for April 2008
- TRC Training Schedule - July 2008
- TRC Training Schedule - June 2008
Entries (RSS)
June 20th, 2008 at 8:14 am
to: consultant
nag email n po ako boyh add.
interested po ako don s internal control may i know if you received my e-mail? how much it cost po pala detecting fake?/internal control?
June 20th, 2008 at 7:58 am
sorry for the wrong e-mail
(wrong)@trainors4number1pawnsop@yahoo.com
to:(right)
e-mail us @trainors4number1pawnshop@yahoo.com
starting a pawnshop business?
1.construction.(vault,other security measure like 911 ect.)
2.permits ,licenses
3.securing the pawned items.
4.appraisal trainning gold,diamond,other gemstones & valuable items
5.operations manual, running the business actual recoding
6.internal control,identifying risk
7.pawnshop possible major risk, detecting fake items,gold plated etc.
8.branch operating system review and recontruction
9.refresher course for appraisers
10. cutural enhancement vision ,mission.
leading pawnshops in the philippines continue enhancing their focus on number 3 to 10
e-mail us @trainors4number1pawnshop@yahoo.com
April 10th, 2008 at 10:42 am
@ismael, contact TRC at 727-6205 for provincial schedules
March 25th, 2008 at 12:29 pm
I want to start of pawnshop business but I need all the skills needed such as appraisal and Pawnshop Operation, gold testing, diamond grading, pricing, valuation and identification of gemstones. May I know where in region X who offer such training.
I look forward to hear you soon.
MR. ISMAEL S. BALIONG
Mambajao, Camiguin
March 10th, 2008 at 11:23 pm
Thanks for the info.
please send me the materials , tools.everything needed inside a pawnshop
like the scale etc. and where to buy those things.
maraMING SALAMAT.
March 9th, 2008 at 11:36 am
anong plant property and equipment ang kailngan para makapagpatayo ng pawnshop? salamat.
February 4th, 2008 at 2:12 pm
can u give me an idea how much capital do i need to prepare to have a pawnshop business.
November 28th, 2007 at 12:34 pm
[...] Appraisal and Pawnshop Operation Lecture: gold testing and diamond grading, pricing, valuation and identification of gemstones, [...]
October 10th, 2007 at 6:11 pm
Dennis Says: 3/29/2006 06:28:00 PM
okay tong blog mo eu-leh, malaki maitutulong sa mga Pinoy na gusto magnegosyo. Lagi kong babasahin ang blog mo, salamat :0)
Eu-Leh Says: 3/29/2006 10:09:00 PM
thank you for the compliment at salamat din for dropping by dennis!
Anonymous Says: 9/11/2006 10:27:00 AM
Thank you very much iam opening a pawnshop of my own soon.Your article gave me even more inspiration.Can you write about the tricks of the trade(pawnshop) i know may mga secrets in operating a successful pawnshop.Salamat and GOD BLESS
Anonymous Says: 12/13/2006 01:33:00 PM
hello, i need your help. can anybody tell me the things needed to start a pawnshop. i mean, the equipment. and where to purchase them. thanks.
Anonymous Says: 6/06/2007 10:58:00 AM
hi… the BSP pawnshop hotline you posted was not the number. i have been calling but wrong number. would you know their new hotline #? thank you and very much appreciated!
Eu-Leh Says: 6/06/2007 03:19:00 PM
here’s the contact details of Bangko Sentral ng Pilinas:
Bangko Sentral ng Pilipinas
A. Mabini St. cor. P. Ocampo St.,
Malate Manila, Philippines 1004
Tel. No. : (632) 524.70.11
Fax No. : (632) 523.62.10
E-mail: bspmail@bsp.gov.ph
BSP - Security Plant Complex
East Ave., Quezon City
Tel. No. : (632) 929.70.71 to 90
Fax No. : (632) 926.25.94
Anonymous Says: 6/07/2007 08:53:00 AM
i got those contact infos but they said they dont know what im referring to? too bad! wala bang directline dun sa licensing ng pawnshops?
hindi ba pwedeng we go directly to DTI? kelangan pa ba muna ng approval ng BSP sa name ng pawnshop?
very much thanks!
Anonymous Says: 6/07/2007 08:59:00 AM
kelangan ko na po bang ipatayo or i-ready na na ung mismong location na paglalagyan ng pawnshop? iniisip ko kc what if hindi ma-approve?sayang ung capital ko in putting it up.
what are the things I need inside the pawnshop? san po kaya ako pwedeng bumili o magpagawa ng vaults at mga iba pang kelangan?
thanks! ur responses really helps me in starting my chosen business.
Anonymous Says: 9/02/2007 08:39:00 AM
hello..gusto ko pong magtayu ng sariling pawnshop ang hindi ko po alam,kung anong mga equipment na kailangan at kung saan ito mabibili?pwedi po bang malaman kung anong mag tricks of the trade(pawnshop)i know may mga secrets sa pag o operate para maging successful ang negosyu….tnx.
Anonymous Says: 9/02/2007 09:14:00 AM
hi…kailangan po bang mag apply muna ng lisensya for pawnshop bago mag hanap ng location na paglalagyan ng pawnshop?at ilang months ang pag aaply sa sentral bank?THANKS.
Anonymous Says: 9/02/2007 09:22:00 AM
hello..gusto ko pong magtayu ng sariling pawnshop ang hindi ko po alam,kung anong mga equipment na kailangan at kung saan ito mabibili?pwedi po bang malaman kung anong mag tricks of the trade(pawnshop)i know may mga secrets sa pag o operate para maging successful ang negosyu….tnx.
Anonymous Says: 10/15/2006 11:57:00 PM
pupwede po bang pakilinaw nyo kung ano na ang mangyayari sa mga hindi tinubos na alahas. At ano ang gagawin mo dito sa mga items na ito para kumita ka.thanks
Eu-Leh Says: 10/16/2006 07:58:00 AM
Ang mga hindi natutubos na alahas ay pinasusubasta ng mga pawnshop owner sa takdang araw. Kadalasan ito ay binibenta nila ng mas mura sa tunay na halaga pero mas malaki sa halagang isinanla. Dito kumikita ng malaki ang mga sanglaan. Maraming tao ang naakit bumili sa mga ganitong subastahan dahil mura.
Anonymous Says: 3/26/2007 01:59:00 PM
pwede po bang bigyan nyo ako ng detalye kung sa akin na po mismo ang capital, mga magkano po ba ang minimum na kapital para maka pag operate ng pawnshop?plano ko po kasi magtayo ng pawnshop sa lugar namin sa province kc po wala pang pawnshop sa area namin sa province…
thanks in advance
Anonymous Says: 3/26/2007 02:00:00 PM
pwede po bang bigyan nyo ako ng detalye kung sa akin na po mismo ang capital, mga magkano po ba ang minimum na kapital para maka pag operate ng pawnshop?plano ko po kasi magtayo ng pawnshop sa lugar namin sa province kc po wala pang pawnshop sa area namin sa province…
thanks in advance
CV Says: 7/11/2007 05:20:00 PM
Hello po.
Gusto ko rin pong mag tayo ng Pawnshop. Paki sagot naman po kng magkano po ba dapat ang minimum capital ng ganitong business? May ma i refer po ba kayong mga web sites and/or offices na pwede kong mapag kukunan ng inpormasyon?
Maraming salamat po…
Eu-Leh Says: 7/12/2007 02:01:00 AM
Hi CV,
Pawnshop is regulated by the Central Bank. Here’s the link for some documents you need. For more inquiries contact:
Bangko Sentral ng Pilipinas
A. Mabini St. cor. P. Ocampo St.,
Malate Manila, Philippines 1004
Tel. No. : (632) 524.70.11
Fax No. : (632) 523.62.10
E-mail: bspmail@bsp.gov.ph
BSP - Security Plant Complex
East Ave., Quezon City
Tel. No. : (632) 929.70.71 to 90
Fax No. : (632) 926.25.94
Web: http://www.bsp.gov.ph
AYA Says: 9/01/2007 08:15:00 PM
please..sa mga mababait na tayo! pakitulungan po ako! kelangan ko ng lahat lahat ng operating procedure ng pawnshop.. kung ano po ang ginagawa sa pawnshop at panO? saka pano ba pinepresyuhan yung mga alahas? san ko makukuha yon? saka may rules and regulation ba?? pano ko din makukuha yon??
nakakuha ako ng checklist registration requirements for new pawnshop… bukod don at sa mga nakasulat anu pang kelangan ko sa BSP?
paki email po ako!! ayeh_00500@yahoo.com …
salamat sa mga sasagot!!^_^