http://www.manilatimes.net/national/2009/may/05/yehey/business/20090505bus5.html
THE policy-making body of the Bangko Sentral ng Pilipinas (BSP) has imposed a tighter set of rules on pawnshops similar to what the regulator requires of banks.
THE policy-making body of the Bangko Sentral ng Pilipinas (BSP) has imposed a tighter set of rules on pawnshops similar to what the regulator requires of banks.
In a statement, the BSP said the Monetary Board last week approved the application of the "fit and proper" rule on pawnshops, thus requiring proprietors, partners, incorporators, directors and officers of these establishments to have no derogatory records.
The policy-making body of the BSP also raised the minimum level of capital or net worth in relation to a pawnshop's portfolio. The board said the current P100,000 statutory capital is too small and opens the industry to "fly-by-night" operators.
Under the law, pawners have 90 days after maturity to redeem their pawned articles. Pawnshops in turn must notify their clients within the 90-day period before they put the pawned items up for auction.
The new rules require pawners to indicate in the pawn ticket their preferred mode of receiving the notice, whether by mail or courier to a given address or by short messaging system to a specified mobile phone number.
The new rules require pawners to indicate in the pawn ticket their preferred mode of receiving the notice, whether by mail or courier to a given address or by short messaging system to a specified mobile phone number.
Pawnshop owners, however, must comply with "Know Your Partner" procedures consistent with requirements of the Anti-Money Laundering Act and the Anti-Fencing Law.
To minimize malpractices, pawnshops must post on their premises the acknowledgement of registration or authority to operate issued by the central bank, their interest rates and charges, business days and operating hours, among others.
The new rules are effective 15 days after publication in the Official Gazette or a newspaper of national circulation.
As pawnshops increased in number over the years, the central bank drafted new rules to support Presidential Decree 114, or the Pawnshop Regulation Act of 1973.
As of February 2008 there were 6,220 BSP-registered pawnshops.
The new rules came on the heels of a memorandum of agreement the BSP signed with the Department of the Interior and Local Government on information-sharing to ensure only those that have business permits and BSP registrations can operate as pawnshops
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