Yes, even the rich go to pawnbrokers

Published by rudy Date posted on February 1, 2009

ALL pawnshops take “anything of value” as loan collateral, as the sign says out in front. But this one pawnshop, Agencia de Empeños de Makati, goes a lot further.

Aside from the usual jewelry and appliances, however, its vault also houses several paintings, antique wooden sculptures, Louis Vuitton and other signature bags, Swiss watches, pricey electronics such as plasma TVs, iPods and audio systems.

Mike Dizon, president of Agencia de Empeños de Makati, says it is a common misconception that pawnshops are only for the common people. Pawnshop robberies in poor or middle class sections are, after all, regular headlines that you read in newspaper’s metro section.

Indeed, why pawn if you’re awash in cash, so goes the conventional logic. Also, in the snobbish world of the social elite, you don’t want to go around telling people that you’re short of money.

Business up

Dizon believes that if the world continues to go deeper into recession, it won’t be long before even the well-to-do begin to reel from the crisis and start pawning their assets.

“Our business went up by over 50 percent in the second half of last year compared with the year before,” he says.

He expects business to be brisk this year. “Precisely because of the recession in the United States and all around the world, there will be layoffs, and many expiring contracts of overseas workers will not be renewed. As a result, liquidity will be tight and most people will want to have easier credit to meet their short-term requirements.”

So far, the Philippines’ social elite have been spared the worldwide economic meltdown. “A lot of our clients borrow because of a temporary cash need. Sometimes, they just left their wallet at home and needed to pay for a quick purchase. If they need P5,000 or maybe P100,000 at most, they would not want to go to a bank for such a situation,” says Dizon.

Knack for lending

He decided to go into the business after graduating from college over a decade ago after realizing his knack for lending money to family and friends. But he wanted to be unique. “Pawnshops are one of highly competitive businesses. I really saw that there was a need for something different.”

Now, you would presume that banks only cater to those with deep pockets. Not so, Dizon says. Even the rich get turned away because banks prefer real estate as collateral and their minimum loans start at P1 million.

“Banks usually lend you at their own convenience. They tell you how much to borrow,” he says. It was there where Dizon found opportunity.

Anything of value

Other than the usual jewelry and high-end Swiss watches, Dizon accepts “anything of value to the client” as long as it could fit in the vault (a central bank regulation)—paintings, signature handbags and even comic book collections.

Dizon also takes in out-of-the-ordinary stuff as long as it has value. He once accepted several fogging machines, the kind used to flush out mosquitoes, as collateral.

With banks expected to tighten lending to limit the risk of further increasing nonperforming loans, Dizon expects his upper-class clients to prefer pawning assets for cash instead of obtaining longer-term bank or credit card loans. For example, he points out, Rolex watches can be good for loans from P50,000 to P700,000 at Agencia de Empeños.

In short, Dizon wants a pawnshop with a heart. “Pawnshops in Hong Kong have counters that are higher than you. You really feel that they were looking down on you,” he says, amused.

BMWs, brewed coffee

Dizon’s one-branch business on Arnaiz Avenue in Makati may seem miniscule compared with the omnipresent Cebuana Lhuillier or Tambunting, but his well-to-do clients are certainly not. “It’s a who’s who,” he says.

His clients come not just in cars or SUVs but in Mercedes Benzes, BMWs, Volvos and even Jaguars. Dizon’s staff serves Lavazza brewed coffee to customers, who more often than not, prefer to wait in the comfort of their cars. “We try to make everyone comfortable,” he says. Besides, they don’t want to be seen going into a pawnshop because of the social stigma factor.

Art gallery ambiance

Inside, a 1975 oil painting by Jose Blanco, titled “Three Generations,” and four other works adorn a wall, giving the air-conditioned shop a cozy art gallery atmosphere.

Don’t expect to see those all-too-familiar iron bars at the counter that make you wonder if you’re a robber or a customer. Dizon’s shop is, of course, protected by high-tech security systems.

His shop’s name alone, which simply means “Makati Pawn Shop” in so many words in Spanish, is aimed at a niche, upper-class market. Dizon also wants to give a “feel” that his company has been around since the time of Jose Rizal [it was formed more than 10 years ago].

Because of his customers’ esthetic tastes, however, Dizon ruled out having iron bars at the front window and door aside from the counter. His staff wears smart business attire.

Juan Luna painting

There were rare times when he politely turned down a customer. On two occasions a few years ago, Juan Luna paintings were brought to him for appraisal. The paintings were in the tens of millions of pesos. Dizon considered the difficulty of selling something with a stratospheric price tag. There was almost no way of knowing if the Luna paintings were authentic.

“Do you really want to pawn this,” he asked the customer and then suggested that the client pawn something else.

Because Dizon’s customers have the capacity to pay, forfeiture is at a minuscule five percent.

Sotheby’s or Christie’s

So what happens to unredeemed items? They are either put up for sale—such as the paintings at the shop—or auctioned off (the Blanco painting is going for P600,000). Some Swiss watches are sold at a Swiss watch shop co-owned by Dizon at nearby Glorietta mall.

For the more pricey and odd items, such as comic book collections, they are put on the block at internationally famed Sotheby’s or Christie’s auction houses. Two years ago, Dizon relates, one Swiss watch fetched 28,000 British pounds in London.

Swiss watches and jewelry are easy to dispose of, according to Dizon. Not so with paintings. “Art is subjective,” he says.


Dizon’s most sought-after service, actually, is confidentiality. His pawnshop never says who visited it and what was pawned.

Another concern of his customers is the welfare of items pawned, especially if they are heirlooms. “Most of them ask us, ‘Will they be taken care of,’ ” Dizon says.

He notes that Queen Isabella I of Spain did pawn her jewels to bankroll Christopher Columbus’s expedition to America in 1492. So if going to a pawnshop was fit for a queen, it shouldn’t be that much of a shame then.–Norman Sison, Philippine Daily Inquirer

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