The Pawnshop Industry in Philippines will continue to grow at a remarkable pace in the coming years with minimal transaction costs on the part of borrower, easy and quick availability of loan and higher accessibility of pawnshops even under the remote areas of the country. It has been estimated that the market will grow at a CAGR of ~% and is expected to cross PHP 120 billion by 2020 in terms of loan disbursed and PHP 180 billion by 2020 in terms of the total volume of domestic remittance transactions conducted through the pawnshops. The major companies in the market will continue to prosper with expanding their physical network and partnering with different institutions to compete against other pawnshops. Lack of credit facilities, lower credit card penetration and incomplete credit histories has prompted the borrowers to resort to the pawnshops since they require just a valid identity proof and collateral to provide the credit.
As of September 2015, 28,264 financial institutions were regulated by the central bank. The number of pawnshops augmented at a CAGR of 2.2% from 2010. The broader reach of pawnshops has been fundamentally attributed to the ease of establishment. In contrast to a bank, a pawnshop requires limited space, fewer staff, and requires much less capital, where it is mandatory for each pawnshop branch to have a capital of just PHP ~, as stated by BSP
Filipinos employed in the BPO sector, call centers in particular, have been a major growth driver of the domestic remittance market in Philippines over the past five years. Since majority of the call centers are located in urban regions such as the NCR, with manila being the hub, a significant proportion of Filipinos migrate to these areas in search of employment in BPO companies. Moreover the pawnshops have the widest reach in the country out of all other remittance centres. This directly translates into a significant demand for money remittance services to the pawnshops as these people opt for such services to send money to their families who are in far off areas where only pawnshops have access to.
However, there are certain market challenges that are faced by the pawnshops. One of the biggest challenges faced by the pawnshops is the threat of robbery or burglary. This has been the most concerning problem for the pawnshops since many years.
According to an industry veteran, “The remittance transactions are growing at a rapid pace and have even overtaken its core function- pawning in terms of volume of transactions for some companies.”
“The advent of online pawning with lower interest rates, longer lending time and greater ease of transactions will completely change the dynamic of pawnshop market in Philippines.” according to the Research Analyst, Ken Research.
The report titled “Philippines Pawnshop Market Outlook to 2020 – Convenient Pawning and Remittance Services to Stimulate Growth” provides detailed overview on the Pawnshop Market and will help the readers to identify the ongoing trends in the industry and anticipated growth in future depending upon changing industry dynamics in coming years. The report will help industry consultants, pawnshops owners and managers, Remittance players, bills payment stores, government and private insurance companies and other stakeholders to align their future growth strategies according to ongoing and expected trends in the future considering the recommendations and insights given in the report.
Key Topics Covered in the Report:
Philippines Pawnshop Market
- Market Size by Loan Disbursed, Volume of Remittance Transactions and Number of Pawnshops
- Market Segmentation by
- Services Provided- Pawning only or Auxiliary along with Pawning
- Re payment Period
- Pawned Items
- New or Renewed Transactions
- Head offices or Branches
- Income Source
- Trends and Development
- Growth Drivers
- Value Chain Analysis in Pawning and Money Transfer Spaces
- Porter’s Model for Philippines Pawnshop Market
- SWOT Analysis
- Government Regulations
- Competition and Market Share in Pawning and Money Transfer Spaces
- Company Profiles of Major Players in the Market in Pawning and Money Transfer Spaces
- Snapshot of Online Pawnshop Market
- Snapshot of Bill Payments via Pawnshops
- Snapshot of Insurance via Pawnshops
- Future Outlook
- Cause and Effect Relationship between Industry Factors and Growth of Industry
- Analyst Recommendations
- Macro Economic Parameters
Key Products Mentioned in the Report
Bill payments and e-load
Companies Covered in the Report
Ankur Gupta, Head Marketing & Communications