Style / Accessories

Hong Kong’s rich turn to handbag-backed loans

Wealthy Hong Kong residents in need of a quick cash injection are reportedly using luxury handbags as collateral to secure small, short-term loans.

Aug 20, 2013 | By AFPRelaxnews

luxury shopping hong kong

Hong Kong’s ladies-who-lunch are indulging in a smart new trend — cashing in luxury handbags for quickie loans in the Asian style capital.

Luxury purses by brands like Hermès, Louis Vuitton and Gucci can all be used to secure a loan in less than half an hour, with specialist pawnbrokers providing cash at up to 80% of a bag’s value.

Yes Lady Finance Co. offers the first specialized loans against pricey purses in Hong Kong, a city with around 200 licensed pawnbrokers and nearly a thousand shadier backstreet operations.

The company’s “brand name handbag loan” provides cash in half an hour in exchange for genuine luxury bags from big name brands. Customers then have to pay off their loan at 4% monthly interest within four months to get their arm-candy back.

According to the Wall Street Journal, Yes Lady recently lent one client $20,600, which was guaranteed with a famous Birkin bag by French luxury label Hermès.

Another happy customer, office worker Angel Yam, received a $1,550 loan for her Chanel bag. “I have too many idle handbags at home,” Yam told the Wall Street Journal, saying she used the money to travel and buy stock and wasn’t too concerned whether she got the bag back. Other clients use the loans to cover school fees or holiday costs while avoiding lengthy credit checks and banking delays.

Luxury goods loans are growing around the world: in Australia the Cash Now Perth loans company also provides loans guaranteed against “luxury cars, boats, jewellery, art and anything of value.”

Expect to see plenty more specialist services popping up, helping cash-strapped luxury lovers take advantage of the assets in their closets.

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