BSP issues precautions against pawnshop malpractices

Looking back over the year there have been some notable actions that pawners would be well advised to be aware of. One is the June media realease by Bangko Sentral ng Pilipinas (BSP) to the public in general and pawners in particular. The BSP release titled “Warning: Be Aware of Pawnshop Malpractices” offers good precautions that pawners should pay attention to.

1. Deal only with a pawnshop that has a current business/mayor’s permit issued by the city or municipality where the pawnshop is located and that is registered with the BSP. A pawnshop that has no business/ mayor’s permit and that is not registered with the BSP is operating illegally.

2. Be sure to transact only inside the premises of the pawnshop.

3. Be aware of the interest rate and other charges, if any, collected by the pawnshop. Determine if such interest rate is yearly, monthly or daily. In addition to interest, pawnshops may collect service charge equivalent to 1% of the principal loan but should not exceed P5.00. However, other charges such as insurance and storage fees in the safekeeping of pawns should not be collected from the pawners.

4. Demand a pawn ticket which contains the terms and conditions of the loan.

5. Bear in mind the date of maturity of the obligation. A pawner has 90 days from the maturity of the loan to redeem the pawned item. The pawner should be notified before a pawned item will be sold in a public auction within the 90-day period, after which the public auction of the pawned item can take place.

6. If the pawnshop fails to return the pawned item when redeemed for certain reasons, e.g., it was lost due to robbery or hold-up, said pawnshop should have a police report on the incident that includes an inventory of all lost pawned items. The pawnshop must also submit to the BSP a Report on Crimes and Losses on the incident.

If the pawn is lost, destroyed or becomes defective due to a fortuitous event and without the fault of the pawnshop, the pawnshop may not be held accountable for the loss. However, if the loss, destruction or damage to the pawn was through the negligence or fault of the pawnshop, the pawner can file a claim against the pawnshop or file a case in court if he/she so desires.

Contact Regulatory Agencies

For inquiries regarding pawnshop’s operations/BSP registration, please contact the BSP
through the following:

Telephone: 523-1706 or
524-6929 or 523-2582 (Direct Lines)
524-7011 (Trunk Line)
locals 3017/3018/2653/2562
Mail: The Director
Supervision and Examination Department V
Bangko Sentral ng Pilipinas
A. Mabini St., Malate, Manila

b. For complaints against pawnshops, please contact the BSP Consumer Affairs Group through the following:

Telephone: 523-1706
or 524-6929 or 523-2582 (Direct Lines)
524-7011 (Trunk Line)
locals 3017/3018/2653/2562
Telephone: 523-3631 (Direct Line)
524-7011 local 2584 (Trunk Line)
Mail: The Manager
OSPD Consumer Affairs Group
Supervision and Examination Sector
Bangko Sentral ng Pilipinas
A. Mabini St., Malate, Manila

 

You can find the official BSP release here.

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