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According to the Bangko Sentral ng Pilipinas, 72 percent of Filipinos have gone to pawnshops over the last 12 months, not only to pawn a property, but also to pay bills or send or receive remittances.
BSP Deputy Governor Nestor Espenilla told reporters that the result of the central bank’s survey showing the extensive use of pawnshops for bills payment and remittance facilitation indicates that pawnshops have become a major financial services provider in the country.
“The way pawnshops have been used to access financial services is transformational,” Espenilla said.
The reliance of the citizenry on pawnshops for these services may be explained by another BSP survey which shows that 610 out of the 1,634 municipalities in the country do not have even a single bank operating in it.
Espenilla said many banks are reluctant to put up branches in conflict-torn and low-income rural areas because doing so is seen to be unprofitable.
Given this scenario, he said, pawnshops play a crucial role in filling in the gap between the demand for financial services and their accessibility in the countryside.
Espenilla noted that pawnshops have a wider presence in the rural areas than banks do. — DVM, GMA News