Demand at UK’s largest pawnbroker hits record high amid cost-of-living crisis | UK cost of living crisis

A record number of people are pawning items to borrow money from Britain’s largest pawnbroker amid an escalating cost of living crisis.

H&T Group said in a trading update issued Monday that “loan pledging” — loans secured against a customer’s valuable items such as watches or jewelry — is at record levels.

The pawnbroker’s growth was fueled by customers’ tight finances amid 40 years of high inflation, according to Shore Capital, an investment bank. CPI inflation hit 9.1% in May, the highest since February 1982, on the back of widespread price hikes fueled by the disruption from the coronavirus pandemic and Russia’s invasion of Ukraine.

Borrowing at H&T has surpassed pre-pandemic highs without an easing of lending criteria.

“We believe this strong demand reflects the impact of the cost of living crisis and the withdrawal of competition from the high-cost unsecured lending space, including the recent closure of two of the leading home loan lenders. ‘ wrote Gary Greenwood, an analyst at Shore Capital.

He added that the cost of living crisis is likely to continue to support demand for pawnbrokers. Economists expect household finances to be hit further in the autumn when the UK’s energy price ceiling will soar to reflect higher prices in global wholesale markets.

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H&T’s pawnbook was worth £84m at the end of June, up 74% from £48m a year earlier and up almost £20m since late December when it was at £67m lay. The company said there was “growth across the group’s customer base and across all regions.”

Founded in London in 1897 by Messrs. Harvey and Thompson, H&T has 256 stores and more than 1,400 employees. It also offers travel money, check cashing and gold purchases. Those other services have benefited the company as demand for gold has been “buoyant” due to rising prices and the return of international travel after pandemic restrictions meant a strong recovery in foreign exchange.

Chris Gillespie, Chief Executive of H&T, said: “I am pleased with the progress we have made in the first half of 2022 and the momentum with which we move into the second half.”

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