The value of loans made by pawnbrokers in the UK topped £250 million last year after a 13% rise, new data shows. Data from audit and tax firm Mazars shows that the value of pawnbroker loans increased from £224 million in 2022 to £252 million in 2023, as the cost of living crisis put stress on household finances. Amid interest rate uncertainty, many traditional lenders also tightened borrowing criteria, which helped to fuel the rise as well. In addition, the FCA’s crackdown on other “sub-prime” consumer loans, like payday lending, contributed to greater demand for pawnbrokers as lenders. That comes despite sky-high interest rates on many loans offered by pawnbrokers. Many pawnbrokers’ highest-interest loans have an APR in excess of 100%. Ed Thomas, director in the restructuring services practice at Mazars, says: “A big jump in lending by pawnbrokers is a bad sign for the financial health of British households. “Where people with bad credit would once have taken out payday loans, they’re now being forced to pawn items like jewellery and watches. “People who have reached the stage of considering pawnbroker loans should look at whether a formal insolvency process might be a better way forward for them. A...