Regulating Pawnshops (Concluded from Last Week)
MANILA, Philippines - Financial consumers, especially those who transact with pawnshops, would be happy to know that the Bangko Sentral ng Pilipinas (BSP) actively supervises pawnshop operations.
In addition to coordinating with local government units in weeding out businesses illegally operating as pawnshops, the Bangko Sentral also conducts inspections of pawnshops to ensure that they adhere to applicable laws, rules, and regulations.
The Integrated Supervision Department I (ISD I) of the BSP said that beginning 2012, inspections of pawnshops have been intensified "owing to the increasing role that these institutions play in bringing about formal financial services to the Filipino people."
These inspections focus on consumer protection and compliance with Anti-Money Laundering Regulations.
The popularity of pawnshops has also caught the attention of the country's lawmakers. In June 2010, a bill co-authored and sponsored by Senators Miriam Defensor Santiago and Manuel Villar was filed in the Senate to amend the Pawnshop Regulation Act. Among the proposed provisions of the bill are the following:
Increase the required capitalization of pawnshop from R100,000 to R1,000,000.
Only a corporation will be allowed to operate as a pawnshop.
Redemption period will be limited on electronic items.
Transfer the supervision and regulations of pawnshops to the Securities and Exchange Commission (SEC).
However, as of 31 December 2011, no further action had been taken on the Senate bill.
The ISD I noted that pawnshops now cater to all segments of the population "as their operations vary depending on the location of the outlet and needs of the customers." In Makati City, for example, there are several pawnshops that accept works of art (paintings, sculpture), expensive watches (Breitling, Breguet, Rolex) and bags (Bottega Veneta, Chanel, Louie Vuitton). …