Pawnbrokers baffled by uptick in gold redemption
Closure of gambling outlets could be a possible factor in the trend
More people going to pawnshops during the circuit breaker period are redeeming their gold jewellery than pawning their items for cash.
The trend has baffled pawnbrokers, whose shops remain open to help provide access to cash for those with financial needs.
Mr Ivan Ho, president of the Singapore Pawnbrokers' Association, told The New Paper that while there is lower footfall, pawnbrokers have noticed that the number of people redeeming items is now about 10 to 15 per cent more than that of those pawning their valuables.
Mr Ho, who runs Heng Seng Pawnshop at Toa Payoh Central, said more than half of his 100 or so daily customers are Singaporeans redeeming their pawned items.
He suspects the closure of gambling outlets has contributed to the uptick.
"It could be because Singapore Pools has shut, and so some people have found themselves with extra cash from not placing their usual bets," he said.
Pawnbrokers here can apply to remain open, and those with the association have developed a plan to offer interest waivers.
The plan allows for all pledges pawned before April 6 to be given a one-month interest waiver upon redemption or renewal if the pawn period exceeds a month.
Pawn tickets that expired on or before May 4 are also given a one-month extension from expiry if the pledge has not been forfeited, along with a one-month interest waiver for redemption or renewal.
At Toa Payoh Central on Tuesday, business at pawnshops appeared to be brisk.
When approached by The New Paper, several customers said they found themselves with "extra cash" recently and so decided to redeem their items.
An elderly Singaporean man, who declined to be named, redeemed his gold jewellery using the $600 he received from the Solidarity Budget last month.
He said: "It's a good thing the pawnshops are still open, because I could redeem my item with the extra money from the Government instead of having to renew my pawn loan."
Nominated Member of Parliament and Singapore University of Social Sciences economist Walter Theseira said it was difficult to identify a specific reason for the trend.
"They could think gold prices will go up or gold will be more valuable than cash in a crisis," he said.
"People in financially tight circumstances sometimes keep cash low as a deliberate strategy, because having too much either encourages spending by themselves, or spending by others who know about it.
"Or morbidly, they are worried about their health and want to ensure any family keepsakes are in their possession in case something happens to them suddenly."