Are pawnshops ethical? | Capital Pawn

Are pawnshops ethical?

Are pawnshops ethical?

Would you consider yourself a person who not only knows the difference between right and wrong but also acts on your convictions regardless of circumstance? A person of integrity?

As a person of "integrity" do you believe that heading to your local pawnshop to pawn an unused, valuable item goes against your code of ethics?

Many people have stereotypical beliefs that all pawn shops deal in stolen merchandise. They assume that criminals can simply walk in with a stolen item, pawn it, and get good money. Truth be told, less than one percent of pawnshop transactions deal with property that's been stolen.

It might surprise you but pawnshops are more ethical than you think.

Here's why.

They're regulated by local law

As pawnshops are in the business of loaning people money in exchange for holding an item of value until the loan is repaid in full, pawnshops are considered as part of the financial services industry. It is because of this that they have to follow certain regulations and laws when it comes to things like handling transactions, obtaining customer information, setting fees, and interest rates, and the amount of time they can store items on behalf of a customer. Law enforcement officers are also required to keep a close eye on pawnshop businesses to ensure they are behaving in accordance with the country's law.

Regular Inspections by Law Enforcement

Often a representative from the regulators will show up unannounced on behalf of the government to inspect pawnshops. This is normally done annually. Knowing that a surprise visit is always a possibility usually keeps pawnbrokers on their toes and they tend to run a well-oiled machine.

No tolerance for stolen goods

There has always been an unfair misconception that pawnshops are riddled with stolen goods. This is simply untrue. Pawnshops have access to a wide variety of technology these days that makes identifying and tracking stolen goods much easier than it was before.
Pawnshops work closely with the South African Police Service to ensure stolen goods are kept out of their stores.

Every item that is brought in is recorded by serial number into a database. This makes it
easy to identify and track down the rightful owner in the case of a stolen item. There are extremely serious consequences such as imprisonment for a pawnshop selling stolen items.

It is simply not worth it to a pawnbroker

They can determine the value of your item

One of the biggest ethical questions people have regarding pawnshops is how a pawnshop determines the value of the item? Many people have the misconception that pawnshops are out there to "rip-off" unsuspecting citizens.
Determining the value of an item is a lot more complex than simply looking at the item and throwing out the first number that comes to mind. There are a variety of factors that play a role in determining an item's value.

For example, when a pawnbroker appraises a piece of jewelry, they will consider the metal that the piece is made from, the purity, weight, and embellishments. After considering all these factors the pawnbroker will then put together an offer for the customer. For the most part, no pawnshop is intentionally trying to cheat you.

Many pawnshops go to great lengths to provide fair appraisals and deals on items. While pawn shops are a lot more ethical than you might think, be sure to work with one that you trust.

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