A pawnshop that lends money as collateral for goods. In Japan, it often evokes the image of an old loan business. You won’t often see one on the street, and I don’t think many people have ever used one. However, in Vietnam, there are still pawnshops that operate privately everywhere. This shows that there are many users, but how are they used?
What is a pawnshop in Vietnam?
In Vietnam, pawnshops are called "Cam Do," and you can often see them in the streets, primarily as small, privately owned businesses. They lend money against collateral for everything from precious metals to motorcycles and electronics. Interest rates vary from store to store, with some setting rates above the legal maximum while others offer lower rates in exchange for higher fees. It seems that many of the customers are people who have difficulty getting approved for a bank loan or who need quick access to small amounts of money.
When does it get busy?
Because it is easy to borrow money, pawnshops are sometimes used for things like gambling. Although gambling in general is illegal in Vietnam, there are limits on cracking down on gambling that takes place among individuals. There are many types of gambling that take place among individuals during certain events; for example, gambling related to the outcome of football matches is well known, and there are cases where the demand for pawnshops increases when a big upset happens or when a large amount of second-hand items is sold.
Auction house for students
When you look at the signs carefully, you’ll see that one of them says “shop for students.” Technically, it’s a shop that’s easy for students to use. Most of them are located in student-populated areas like universities. They usually have the name “Cam Do Sinh Vien,” meaning “shop for students.” This shop has relatively low interest rates and accepts cheap quality items even for small amounts. It seems to be used when students are short on money or need to temporarily borrow money for an emergency. However, it’s said that students who use the shop are not well-received in Vietnam, and if their parents find out, they’ll be furious. Therefore, it seems that most of the students who use the shop are discreet about it.
Recently, there have been more and more stores like major pawnshop chains offering modern services with the latest technology. As a result, the number of privately owned pawnshops has been decreasing. However, all of them often face criticism regarding high interest rates and collection fees, and enforcement efforts are being stepped up.
author (usu. of a particular book, etc.)
Takuma Inada
Social Security Actuary of Japan
Representative of SESSA VIETNAM CO.
Profile
Having been involved in human resources and personnel affairs in Vietnam for more than 10 years, he currently runs SESSA VIETNAM, which he started on his own. The company provides personnel consulting services mainly in the fields of human resource recruitment, personnel affairs consultation, and labor permit application handling. He spends his days observing Vietnamese people on a daily basis, and it has become his daily routine to think about the “why and what” of Vietnam. While raising his Vietnamese wife and two children, he is constantly striving to provide bilingual education in Vietnamese and English.
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